# Iron Ore



## YOUNG_TRADER

Been reading a bunch of articles saying the Indians have introduced an export tax or levy on thei Iron Ore Exports and as a result alot of Chinese Steel Firms, mainly Sino Steel have stopped importing Iron Ore from China,

Looks like they'll be scouring the Aussie Mkt even more now


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## imajica

it will be great for soon-to-be producers like Territory Iron (TFE) - starting production in May - awesome news


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## BREND

YOUNG_TRADER said:
			
		

> Been reading a bunch of articles saying the Indians have introduced an export tax or levy on thei Iron Ore Exports and as a result alot of Chinese Steel Firms, mainly Sino Steel have stopped importing Iron Ore from China,
> 
> Looks like they'll be scouring the Aussie Mkt even more now




Yes, that's right! BHP and Rio will benefit.


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## Halba

Have a look at some junior iron ore companies like Strike resources (SRK) - building a large high grade haematite mine in Peru, Aquila resources AQA (Pilbara).


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## YOUNG_TRADER

YML is my pick, by far the most undervalued Nickel/Iron Ore development story out there!


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## moses

YT, your PM box is full...


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## michael_selway

YOUNG_TRADER said:
			
		

> YML is my pick, by far the most undervalued Nickel/Iron Ore development story out there!




How much should YML be worth?

thx

MS


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## YOUNG_TRADER

Indian ore tax to help Australia
Rowan Callick, China correspondent 
March 22, 2007 

AUSTRALIA is set to be the major beneficiary, with Brazil, of India's export duty on iron ore - which has already caused Chinese buyers to divert more than 20 ships from India.
India is the main source of the iron ore bought on the spot market by China, which buys more than half India's ore exports. 
It is China's chief alternative to the ore bought under the price negotiated in a contract with the big miners in Australia and Brazil. This will rise 9.5 per cent on April 1. 

The Indian government introduced the duty, effective from March 1, in its federal budget to hold back more ore for local mills. 

The timing was awkward. The duty, passed on to buyers by India's ore suppliers, added more than 10 per cent to the cost of a tonne, just as Chinese mills were seeking to boost imports before the April 1 rise in the contracted price. 

The Indian Steel Alliance is lobbying the government to double the new duty swiftly. 

The Times of India reports that China's steel industry has threatened to stop importing ore from India altogether. 

The biggest Chinese buyer from India, Sinosteel, has pulled out of the market for now. 

Indian Steel Minister Ram Vilas Paswan vowed on Tuesday to provide sufficient support for the steel industry - already growing by 10 per cent per year - to raise its output from 43 million tonnes a year to 175 million tonnes by 2020. 

"Our iron ore export policy should be based on our domestic needs," he said. 

"I am not against export of iron ore, but the needs of the domestic utilities and their expansion plans would have to be factored in. Only after that should exports be allowed." 

In 2006, India supplied 22 per cent of China's imported iron ore, with Australia and Brazil providing most of the rest.


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## 123happy

I'm also interested in small iron ore miners, as friend of mine is seeking to buy iron ore for a Chinese steel mill. 

CFE, RHI, SDL and TRF are some of the junior iron ore players on my screen


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## Bush Trader

Thsi thread has been rather quiet

I just finished reading this fantastic article and thought it would be of interest


Cheers


BT



*Battle Looms In Iron Ore Negotiations*

FN Arena News - September 28 2007 
By Greg Peel

In 1998, China imported 52 million tonnes per annum of the world's iron ore. In 2004 it imported 208mtpa and Merrill Lynch analysts expect the figure to be 400mtpa by the end of 2007. In 2001 China consumed 20% of the world's traded iron ore. In 2007 it will consume 45% and account for over 75% of global production growth.

Chinese steel production continues to boom. At the end of last month, Macquarie reported panic among China's smaller producers as iron ore prices rose steeply. Stock building at mills had pushed the spot price of iron ore from India up from US$75/t at the beginning of the year to US$140/t at the end of August. Australia does not sell iron ore to China on a spot basis, but rather on an annual contract basis. An annual contract runs for the Japanese financial period of April to March. Negotiations for JFY08 will begin in November.

Over the past several months Australian resource analysts have been slowly pushing up their expectations for a contracted price rise. This had served to significantly push ahead the share prices of BHP Billiton (BHP) and Rio Tinto (RIO). We had a credit crunch correction in between, but now we're back again. The analysts at Merrill Lynch are currently factoring in a 30% price rise for Australian iron ore, but believe a 50% rise is quite possible. But Merrills also suggests that but for a longstanding arrangement, the price rise could justifiably be 100%.

Chinese steel mills are now paying US$171/t on the spot market for India's low-grade iron ore. They pay US$136/t for domestic Chinese ore which is also of a low grade. The highest grade ore comes from Brazil's CVRD and is a necessary ingredient in making steel of sufficient quality. For that the Chinese are paying US$118/t on annual contract. Australia's iron ore is of superior quality but not quite to the level of Brazil's. For Australian ore the Chinese pay only US$78/t.

Which begs the obvious question: If China is so desperate for iron ore that it would pay US$171/t at spot for low quality ore, why are BHP and Rio accepting only US$78/t? To adjust the price upwards towards something more equivalent would be to add literally billions to the bottom line of both companies.

The answer lies in an arrangement between Australia and China which has been in place for 25 years. For starters, both supplier and customer prefer to negotiate annual fixed-price contracts than play games in the spot market. This provides price security to both parties. But most importantly, under the arrangement Australia has always borne the cost of freight. The Chinese boom caught the world by surprise, and immediately exposed a dramatic shortfall in infrastructure development. Part of that infrastructure is sea-going bulk carriers, and the amount of iron ore, coal, and other commodities being shipped across the world has risen much faster than the rate at which new carriers can be commissioned. And to top things off, the price of oil has risen substantially. Thus the cost of freight has risen exponentially, and it is that difference which determines the ultimate price Australian producers receive for their iron ore - much less than domestic ore and significantly much less than nearby Indian ore at spot.

But the obvious flaw in this argument is Brazil. It might be a long way from the coast of Western Australia to Chinese ports, but it's a lot further from Brazil - half a world away. On that basis CVRD should ultimately be receiving much less for its ore than Australia.

However the Brazilians argued the toss with the Chinese early in the piece, and as such managed to negotiate a freight cost sharing arrangement. The further iron ore has to travel, the greater the margin of increase on rapidly rising freight costs. In other words, the greater the cost margin of freight from Brazil over Australia, the greater recompense the Brazilians receive from the Chinese. End result - a higher price for Brazilian iron ore.

So the obvious conclusion here is that Australia is in the box seat. China needs Australian iron ore, so it will have no choice but to pay more for it. The increased price should not only involve a demand premium, but a renegotiation of the freight terms as well. This is why Merrill Lynch can see at least a 30% price rise based on current demand, but can also envisage the scope for a 100% price rise on an equitable freight basis. Australia could double the price of its iron ore, and still be the cheapest on the market after Brazil has negotiated its demand-based price rise. There is, however, one small problem.

The Chinese just won't have a bar of it. This from one recent press report:
"Luo Bingsheng, vice chair of the China Iron & Steel Association (CISA) has said that China will not pay a freight premium for iron ore from Australia. BHP Billiton and Rio Tinto are both expected to ask for more money for their ore in the upcoming negotiations, because its landed cost in China is cheaper than ore from Brazil. CISA anticipates a lengthy and 'difficult' round of price negotiations this year."

Macquarie suggests "Exactly how the negotiations will pan out is difficult to predict at this stage. What seems clear is the negotiations will be long and drawn out and acrimonious (for the Australians)".

Acrimony aside, Merrill Lynch suggests there will never be a better time than now for Australian producers to play their hand and negotiate a better deal. The global iron ore market will remain substantially undersupplied until at least 2011, the analysts believe, and could even remain so out to 2013 depending on how fast Fortescue Mining (FMG) can ramp up. What's more, without a substantial rise the Australians (and the Brazilians) are already facing a loss on currency appreciation. Merrills also believes the Chinese steel industry has the room to pass through increased raw material costs to customers.
And if negotiations are unable to reach a conclusion by June 2008, BHP and Rio can sell iron ore on the spot market.

Merrills has played out some scenarios. Brazil will enter negotiations first, and if CVRD successfully negotiates a 50% increase in price based on demand, then this equates to a US$72/t price leaving Brazil. Add US$70/t for freight, and the price to China is US$142/t. If Australia offers a 20% discount to spot, or a 10% discount to Brazil, the price would be US$128/t. Subtract a Australia-Brazil freight margin of US$28/t and we're left with US$100/t leaving Australian shores. The JPY07 price was US$51/t - hence an almost 100% rise.
This would add US$5.4 billion to Rio's pre-tax and pre-royalty earnings, and US$3.6 billion to BHP's.

Back in JPY05 BHP attempted to push a change to contract structure, but was forced to back down when it received no support form Rio. Rio now has a new CEO who is believed to hold a differing view and is prepared to talk turkey.

So now it's just up to the Chinese.


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## eMark

With the recent coverage regarding the Iron Ore contract price re-negotiations (increase?!) happening in November. Do any of you believe that this may further benefit the small cap spec stocks? Maybe even possibly a 'uranium' style rush into stocks that are exploring for iron ore.

Just a thought.


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## michael_selway

eMark said:


> With the recent coverage regarding the Iron Ore contract price re-negotiations (increase?!) happening in November. Do any of you believe that this may further benefit the small cap spec stocks? Maybe even possibly a 'uranium' style rush into stocks that are exploring for iron ore.
> 
> Just a thought.




Which ones u thinking of atm?

thx

MS


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## eMark

Well the two that I am specifically watching at the moment are JMS & IRM. There are others, but I am not suitably aware of them to comment. There have been a couple of 'explosions' with the SP of small cap spec stocks over the last couple of weeks. It just would appear that the rumblings may become louder as the negotiations draw near.


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## mick2006

should be a very interesting couple of weeks for a few of the junior iron ore sector players with LML and UMC releasing results on exploration drilling next week, and then TLM following a couple of weeks later.

With so much focus on iron ore due to the supply/demand equation and the upcoming yearly contract talks any decent hits from any of these three companies will send the shareprices racing.

Having indentified POL,IRM,LML as having excellent potential in the iron ore space, I have come accross another beauty that has flown under the radar, and will give the usual heads up once I managed to grab a few myself(so guys and girls check your PM's later on Monday)


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## Sean K

AQA/HLX drilling results imminent from Yalleen JV. Trying to confirm 100Mt potential, plus numerous other anomalies being tested. 

Ramp, ramp.


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## krisbarry

kennas said:


> AQA/HLX drilling results imminent from Yalleen JV. Trying to confirm 100Mt potential, plus numerous other anomalies being tested.
> 
> Ramp, ramp.




Why is it OK for some to ramp?


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## Sean K

Stop_the_clock said:


> Why is it OK for some to ramp?



If you can't recognise that comment as a joke you have serious issues STC!


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## krisbarry

So where do members go to get help for serious issues with ramping?

I have 10 infraction points all cause by so called ramping.

Is there a detox house, or therapy room, you know that is all the rage these days (Hollywood)

Maybe I am just another fallen star

Back to the issue at hand, was watching Inside Business this morning and Iron Ore is hot hot hot!


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## stockGURU

Stop_the_clock said:


> So where do members go to get help for serious issues with ramping?
> 
> I have 10 infraction points all cause by so called ramping.
> 
> Is there a detox house, or therapy room, you know that is all the rage these days (Hollywood)




I would recommend going to other forums.


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## Sean K

stockGURU said:


> I would recommend going to other forums.



I agree.

STC, If you truly thought that was 'ramping', please go to another forum where you may not recognise humour, or have the required common sence to provide constructive input and feedback. 

Or, please stop drinking so early in the day!


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## YOUNG_TRADER

Looks like Sino is already conceding a 25% price hike

http://www.bloomberg.com/apps/news?pid=20601086&sid=at6HO2S6zZck&refer=news


p.s. Kennarico stop ramping :


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## nizar

YOUNG_TRADER said:


> Looks like Sino is already conceding a 25% price hike
> 
> http://www.bloomberg.com/apps/news?pid=20601086&sid=at6HO2S6zZck&refer=news
> 
> 
> p.s. Kennarico stop ramping :




YT get back to studying! :


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## michael_selway

nizar said:


> YT get back to studying! :




What does YT study? 

thx

MS


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## KIWIKARLOS

outlook for iron ore certainly very good. wondering if someone could help out with more info regarding iron ore types.

Apparently the stuff been mined and shipped now from BHP , Rio etc is Direct shipping ore, that is dug up and loaded for shipment right away. These operations have small up front cost and quick start up time. This ore can be found in Iron Channel formations such as in the pilbara.

In opposition to this i heard that magnetite projects can't have the ore directly shipped because it needs processing before its of use to the steel makers. The chemical composition of DSO is much different to that of magnetite projects. Because of this Magnetite projects cost more upfront and take years to get off the ground.

This came about becuase of the MMX takeover, the company believes in the next couple years its the DSO plays that will make the most where as major magnetite operations wont become a big part of the market for 10-15 years. Apparently the chinese are more interested in the DSO.

Companies i know of with DSO are.
BHP
RIO
YML
AGO

any thoughts?


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## michael_selway

KIWIKARLOS said:


> outlook for iron ore certainly very good. wondering if someone could help out with more info regarding iron ore types.
> 
> Apparently the stuff been mined and shipped now from BHP , Rio etc is Direct shipping ore, that is dug up and loaded for shipment right away. These operations have small up front cost and quick start up time. This ore can be found in Iron Channel formations such as in the pilbara.
> 
> In opposition to this i heard that magnetite projects can't have the ore directly shipped because it needs processing before its of use to the steel makers. The chemical composition of DSO is much different to that of magnetite projects. Because of this Magnetite projects cost more upfront and take years to get off the ground.
> 
> This came about becuase of the MMX takeover, the company believes in the next couple years its the DSO plays that will make the most where as major magnetite operations wont become a big part of the market for 10-15 years. Apparently the chinese are more interested in the DSO.
> 
> Companies i know of with DSO are.
> BHP
> RIO
> YML
> AGO
> 
> any thoughts?




Hey for AGO, do you know what the mine life is?

*Earnings and Dividends Forecast (cents per share) 
2007 2008 2009 2010 
EPS -13.9 10.3 19.4 -- 
DPS 0.0 0.0 0.0 -- *

Thx

MS


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## Sean K

michael_selway said:


> What does YT study?
> 
> thx
> 
> MS



YT is studying mechanics at TAFE. He's hoping to understand how to make an Italian piece of crap go from automatic to manual....


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## mick2006

For all the usual suspects check your PM box, there is a piece of research on probably the last of the undiscovered iron ore plays, with sampling results due within a two weeks and drilling to commence next month this little gem will start to catch the eye, not to mention some exciting gold/copper results also due shortly.


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## KIWIKARLOS

Hey mick can I scam a copy of your research?

Pleeeeeeeeeeease

Im just a poor little kiwi boy trying to make a buck.


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## YOUNG_TRADER

kennas said:


> YT is studying mechanics at TAFE. He's hoping to understand how to make an Italian piece of crap go from automatic to manual....




lol, better than walking mate 

p.s. How many times do I gotta tell ya, its been sold!


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## dogwithflees1983

AGO seems to be going from strength to strength

up again today, and appears to be a very solid stock!


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## KIWIKARLOS

AGO has DSO and magnatite projects, also helps that is was mentioned in the herald I think last week in regards to murchinson metals. I've been also looking at red hill iron but their JV tennements are a fair distance from infrastructure and is magnetite also. Although FWL looks ok its a Mag project hopes to ship in 2011 so there is a few milestones to get us there but good profitable project.


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## mick2006

Just a quick look at what is perhaps the last undiscovered iron ore beauty left on the ASX, with several exciting iron ore JV's with PSP and ACS, after discussions with the company it looks like we will be hearing a fair bit of news regarding not just iron ore but gold and copper as well in the coming weeks. 

*Anyone of a number of different announcements could move the shareprice.*


-Spoke with the company have been in the field and expect iron ore rock chip sample results within two weeks(have recorded samples of over 60% Fe already likely to move the market if they hit it again)

-Commencement of iron ore drilling and exploration at three locations Woolshed Prospect, Warriedar Prospect, MAGNETITE RANGE PROSPECT. (just the announcement will likely move the shareprice not to mention any further rock chip samples to be released)

-Drilling Results from Goldern Mile South JV (located only 4km south of the Kalgoorlie Superpit 75 million oz gold, the largest gold mine in Australia)

-Drilling Results from Kapulo Copper Deposits in Africa (with previous results up to 31% copper.)


Iron Ore

Payne's Find JV PSP(60%) MWE (40%)

The joint venture covers an area of 200 sq km in the Midwest Iron Ore Region with several prospects making up a total strike of over 17km.


Woolshed Prospect

With a current strike length of around 4km and a likely target of *50-60 million tonnes of DSO hematite ore *with samples grading up to 59.9% Fe.

Drilling to commence shortly as confirmed by company, likely to draw attention to company due to frenzied state of iron ore plays.


Warriedar Prospect


The Warriedar Prospect is in close proximity to both Gindalbie's massive Karara project and Mt Gibson's major projects.

Current Strike of around 8km with samples confiming both magnetite and hematite iron ore, with samples ranging from 40%-*62.8% Fe*.

Activity is starting to increase at the Warriedar Project with further rock chip samples to be followed by a round of drilling(to follow drilling at Woolshed), any further high grade samples likely to be a share price mover.


MAGNETITE RANGE PROSPECT,
MOUNT GIBSON (ACCENT RESOURCES NL 80%,
MAWSON WEST LTD 20%)

A detailed aeromagnetic survey has recently been completed on the Company’s Magnetite Range prospect at Mount Gibson. The survey covered a strike length of 14 km of banded iron formation which is along strike from Sincom’s Extension Hill 250Mt magnetite deposit The survey delineated several target zones with strong magnetic responses which have yet to be tested by drilling. The survey also
showed good correlation between the drilling results of last years programme and the magnetic response. *Targets that suggest possible hematite enrichment *have also been identified.

Drilling is continuing at the Magnetite Range prospect.


Gold

Goldern Mile South JV (SBM 70%) (MWE 30%)

SUMMARY
Only 4km SE of the Kalgoorlie Superpit and amazingly underexplored.
Unparalleled infrastructure –several local operating mills, roads, railways, exploration services etc.
Strategic Joint Venture with St Barbara Mines proven undercover explorers). SBM to spend min $500k in 6 months, and $3M to earn 51% within 3 years. SBM can elect to earn 70% by spending a further $2M in 2 years.* Competed 10,293m of air-core drilling, average depth 66m. Results due anyday*


Copper

Strategic Joint Venture with Anvil Mining 

Approximately 5,500km² of contiguous tenure in DRC and Zambia
MWE can earn 65% by spending US$4 million over
four years.
Approximately *60km of strike *along the
regional Kapulo Shear Zone – which hosts the Kapulo copper deposits (and many other Cu occurrences)
The Kapulo Copper deposits comprise three main zones – Katanga, Safari North and Safari South
Drilling currently underway at the Katanga Prospect – 9 holes completed to date Main primary sulphide mineral is chalcopyrite, with varying amounts
of chalcocite, bornite and on average grades from 5-7% Cu. *Oxide enrichment has formed cuprite, native copper, azurite, and malachite with grades up to 31% Cu.They calculated open ended resources (along strike and down dip) between 750,000t @ 4.7% Cu and 850,000t @ 5.8% Cu, to approx 50m depth (Approx 50,000Cu tonnes)*


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## shinobi346

Cullen is another iron ore hopeful with a lot of JV with the big wigs.

YT, YML calls you.


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## insidetrader

mick2006...is PSP the company you are referring to as 'the last undiscovered iron ore play'???


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## insidetrader

or MWE? sorry it's late...i'm having trouble reading your post...


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## mick2006

Sorry it is MWE just realised that the post doesn't carry the title like the private message.

Really looking forward to the results from the Goldern Mile South JV, being only 4 km from the Kalgoorlie Super Pit, and gold on the rampage again tonight any decent hits will send MWE flying.


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## cuttlefish

How about PLV for an iron ore spec play - potentially massive iron ore resource on Irvine Island - adjacent island to the existing Cockatoo island and Koolan island mining operations.  These have some of the highest iron ore grades in Australia with grades up to 68%.

They recently visited the island and the layer of iron ore is clearly visible in photo's of the island in that report.  I like this comment from their last Irvine Island update:

_“Our observations to date lead us to believe that there is potential for a high grade, low impurity, ore body that is greater than about 30 metres thick and measures in area some 2 kilometres by 3 kilometres"_

Thats a lot of iron ore, and even better its on an island in NW australia so the transport logistics side of things looks pretty good as well - no need to cart it to the coast its already there.

They've also secured a native title agreement for exploration this year.

Has an impressive board that includes ex NSW premier Neville Wran.

Also is currently drilling an interesting copper/gold prospect in tassie at the moment.

Currently in the third day of a break-out on volume from the 1.40 level, probably due to anticipation of potential announcements related to drilling permit on Irvine, and/or because dove river drilling results could come out soon.


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## KIWIKARLOS

Hey guys i've found a very spev play GNL its actually a gold focused explorer but they have a tennement near Iron Mountains (the guys who went up 330% in a day) and they have drilled a few holes and found banded iron formations of high grade haemetite. Thats DSO boys but infrastructure and location a bit isolated. That said it jumped over 100% after ann and has since come back. Now at 4.6c could be a could spec play especially if they ann extension of Haemeitie they reakon the strike is 20kms long!


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## doogie_goes_off

PLV hit 1.80 today on good volume. Read an article in the Age last Friday that suggests takeovers are ongoing in the Iron Ore industry.

http://www.theage.com.au/news/Busin...ely-to-thin-out/2007/10/12/1191696136780.html

All good news for smaller Iron Ore companies


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## cuttlefish

Doogie - re the article on takeovers - Mt Gibson did very well with their purchase of Aztec - who co-incidentally own the iron ore mine on Koolan Island which is adjacent to PLV's Irvine island.    Koolan Island iron ore is supposedly 67 % to 69% Fe,  some of the richest and purest ore going around.  PLV's Irvine island is supposedly a continuation of the same iron ore as exists on Koolan and Cockatoo islands.

Mt Gibson picked up Aztec for under $300 million and now Mt Gibson is capitalised at $2 billion and the Koolan Island iron ore deposit being a big chunk, (around half) their their iron ore reserves.

PLV's valuation is $90 million at the moment based on $1.80 share price, so if it looks like Irvine Island can go ahead, and especially if it has the quantities of iron ore they're speculating on, then there's plenty of room for serious upside. 

Its run strongly the past few days so might pause but its also very tightly held.  The company intimated in their annual report that they expected some news on granting of exploration permits around the october timeframe.


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## eMark

As mentioned in the IRM thread.

Nice recovery.

Last Trade: 0.415 AUD 
Trade Time: 4:10PM AEST 
Change:  +0.050 (13.70%) 
Prev Close: 0.365 
Open: 0.365 
Bid: 0.410 
Ask: 0.415


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## michael_selway

eMark said:


> As mentioned in the IRM thread.
> 
> Nice recovery.
> 
> Last Trade: 0.415 AUD
> Trade Time: 4:10PM AEST
> Change:  +0.050 (13.70%)
> Prev Close: 0.365
> Open: 0.365
> Bid: 0.410
> Ask: 0.415




Some major Iron Stocks

ADY AGO AQA ARH BCI CFE CXM FMG FRS FWL GBG GDM GIR GRR GWR IDO IFE JMS MGX MIS MMX PMM SDL SPH SRK TTY UMC WPG 

thx

MS


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## eMark

michael_selway said:


> Some major Iron Stocks
> 
> ADY AGO AQA ARH BCI CFE CXM FMG FRS FWL GBG GDM GIR GRR GWR IDO IFE JMS MGX MIS MMX PMM SDL SPH SRK TTY UMC WPG
> 
> thx
> 
> MS




Thanks Michael.

That's a few to choose from. Woh!

What's your opinion on IRM at the moment?


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## KIWIKARLOS

breaking those down in to DSO vs magnetite projects could be a could way of sorting the cream from the milk. To make the best of current and short-medium term iron ore prices these DSO operations are the best bet. Most of these magnetite juniors wont be up and mining for at least 5-10 years if at all if there is any change in iron ore prices. Have to remember RIO is hugely increasing its output in the next 24 months. Magentite projects just cant compete especially with the huge operational costs in WA the margins just aren't there atm for those projects


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## KIWIKARLOS

that said here's the ones i know that are DSO.

BHP, RIO, YML, AGO and FMG.

Magnetite projects that can be brought in soon are FWL

IRM and others are unrealistic there magnetite tenements are miles away from any infrastructure and located in the middle of WA. with only rock chip samples at this stage i think IRM is built on hype not on sense


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## nikki

eMark said:


> Thanks Michael.
> 
> That's a few to choose from. Woh!
> 
> What's your opinion on IRM at the moment?




personally, i am still banking on ADY - a solid iron ore producer with good income. more importantly it also has 20% of the worlds lithium in proven reserves in argentina. 

there is a demerger of these two in the near future. share price currently at 0.55 and i think it is cheap compared to other iron ore companies!!!


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## michael_selway

KIWIKARLOS said:


> that said here's the ones i know that are DSO.
> 
> BHP, RIO, YML, AGO and FMG.
> 
> Magnetite projects that can be brought in soon are FWL
> 
> IRM and others are unrealistic there magnetite tenements are miles away from any infrastructure and located in the middle of WA. with only rock chip samples at this stage i think IRM is built on hype not on sense




What do u think of MGX? Is it a DSO?

thx

MS

*Earnings and Dividends Forecast (cents per share) 
2007 2008 2009 2010 
EPS 7.1 11.2 24.3 33.8 
DPS 0.0 4.2 10.4 16.9 *


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## Morgan

MS,

MGX have the Koolan Island deposit now (ex Aztec) Arguably it doesn't get any more DSO than that- just pick it up and throw in the ship off to China/Taiwan/Japan.


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## Bush Trader

It may be time to draw some comparisons between the Iron Ore explosion and the Uranium Job we experienced earlier in the year

Cheers


BT



*Rudi On Thursday
FN Arena News - October 17 2007 *

FNArena has written quite a few stories about iron ore in the past eighteen months. In the second half of 2006, when most experts in the market seemed to assume the benchmark contract price would go up one more time, we suggested this may not necessarily prove correct. This view was backed up by feedback from our industry sources.

It turned out the view was correct. From early 2007 onwards we were quick in notifying our readers that overall expert sentiment was shifting in favour of further price increases for future years. And then again. And again.
As we are approaching another round of annual price negotiations between the world’s most powerful oligopoly –Companhia Vale do Rio Doce (CVRD), Rio Tinto (RIO) and BHP Billiton ((BHP))- and their main customers in Asia, most securities analysts are banking on two more price rises.

The first one, which relates to the Japanese fiscal year that starts on April Fool’s day next year, should see a price rise of some 30%, or more, the following year should generate another but much smaller price rise, probably in the order of 5-10%. All this is not necessarily true. It’s what is currently being put through valuation models at stock brokerages to assess what type of rating should be placed on certain ASX-listed stocks, among other things.
This week I came to realise that we probably haven’t written one single negative story on iron ore yet. It is then that I realised this would be the first one. Call it more of a warning.

No matter how positive the undertone has been in all our previous stories –and there have been many- never at one point did we truly envisage that iron ore would develop into the next market craze. But it has.
Sometime before the August correction a few securities analysts started to argue the case for Australian producers to seek compensation for the freight differential with other countries, Brazil in particular. All of a sudden prospects emerged for a virtual doubling of next year’s contract prices.

Investors needed to know no more. Iron ore companies have been the flavour of the month, and that’s after they became the default flavour in the first half of the year already. The problem now is not so much one of value, but more of risk. Similar to what happened with uranium stocks earlier –when everyone and his dog simply went stir crazy about it- is that many iron ore related stocks are being priced at high expectations.

This does not necessarily mean these expectations won’t be met. For all we know the upcoming negotiations between the three oligarchs and their steel customers will result in another significant price rise and many shareholders will be walking around with big smiles on their faces for many weeks.

The problem with such a scenario is however that it becomes high risk, or to put it in non-financial language: it is rather unlikely, but by no means impossible.

When one talks to securities analysts and other experts about the upcoming negotiations, most will agree the foundations are in place for another significant price rise. But once the discussion touches upon the 50% price increase potential most get cold feet and clammy hands. Some of them simply don’t believe the Chinese will - ever - agree to a price rise of such a magnitude, no matter how tight the market has become.

For Rio Tinto and BHP Billiton there’s a fine balance in play between shorter term financial benefits and longer term customer relationships. Management teams at both companies know the market situation won’t always be like this, so no use in burning bridges that may come in handy a few years down the track.

This is why most securities analysts will mention the 50% option in their research reports, while putting 25-35% in their valuation models.
We’ve all experienced the uranium madness that lasted until June this year, so the next question should be an easy one. What is the main characteristic of a market craze?

Answer: investors price in the best scenario possible. This is why owning shares in many iron ore companies in Australia has now become higher risk. Again, I am not trying to say there is no more upside for the companies involved, but any progress from here comes with disproportional increased risk.

An example is *Mount Gibson ((MGX)) *whose shares touched $2.84 on Tuesday. Even in early March this year one could have still bought the same shares at around 70-80c. If you happen to be one of the shareholders who did buy the shares at the time, good on you, but at Wednesday’s closing price of $2.76 the market is effectively pricing in a price rise of 50% next year.

This means that even if the big three producers negotiate a price rise of 50% the shares are already there.

This is the main reason that UBS initiated coverage on the stock with a Sell today. The broker has so far penciled in a 35% price rise and simply refuses to put the current valuation higher than $1.60.

Analysts at Shaw Stockbroking already covered the stock, but they rate it a Sell too. Shaw has penciled in a 30% price rise but obviously sees some value elsewhere as its target stands at $2.00. While this is significantly higher than UBS’s target, it is also significantly below the current share price.

Another common mistake investors seem to be making is to look at the valuation of a company such as Fortescue (not a producer yet) and then conclude their little mid-capper should be trading at similar multiples. This is almost every time wrong, if only for the simple fact that iron ore is above all an infrastructure story. This means size matters, as well as access to key infrastructure such as roads, ports and rail. Fortescue is looking at becoming the world’s biggest independent producer.

Because of the importance of scale, and of infrastructure, most medium sized companies will find it hard to become a mini-Fortescue. A logical way out is thus to join forces. That’s why Murchison Metals ((MMX)) in the mid-west region of Western Australia is trying to buy neighbour Midwest Corp ((MIS)). It is a public secret that both management teams tried to work out a friendly merger earlier this year, but that went nowhere.

Analysts believe Murchison’s offer might ultimately be successful, simply because the advantages of a combined entity (larger scale, relatively less investments to reach the same goals, twice) look so compelling.
UBS initiated coverage this morning with a Buy for each of the separate entities. Keep in mind that the key factor in this story is that both companies need the development of new rail and port infrastructure for their growth prospects.

UBS, and others, believe the sum of both is poised to turn out larger than two. For starters, the analysts foresee up to $400m in savings simply by sharing infrastructure and equipment.

The broker has placed a target price of $6.50 on shares of Murchison, but regular readers of our daily Australian Broker Call will know already that Merrill Lynch has held a $7 target for the stock for a while now.
UBS’s target for Midwest is $5.90.

Another key factor to watch out for is whether your iron ore hopeful of choice is proposing to mine haematite or magnetite. The first is high grade material with at least 55% iron in it and the preferred product of Rio Tinto and BHP Billiton, the second is lower grade and often demands extra processing costs. The latter means your average producer of magnetite will make less profit and will therefore trade at a lower valuation.

However, that does not necessarily mean one can only find value among producers of heamatite. Mark McDonnell of BBY has been a big fan of Grange Resources ((GRR)) for a while now and his view is the company is ridiculously cheaply valued, especially after signing a key agreement with Rio Tinto to access Rio’s neighbouring tenements.

McDonnell had a wrap about it on CNBC recently. Readers interested can find his views in audio and video via the following link:
http://www.cnbc.com/id/15840232?video=555821296

Last but not least, the sector will go through a consolidation phase as mid-sized companies feel the pressure to up-scale and as larger companies, such as Fortescue, Rio Tinto, BHP and possibly even CVRD will look at cherrypicking the best assets at the right price.

Don’t forget, OneSteel ((OST)) is a major exporter as well. Any surprise in the upcoming contract negotiations is bound to deliver the company’s bottom line a nice bonus. This should translate into a higher share price.


----------



## countryboy

what we have post police on this site who issue out infractions !!?? I want to mention a couple of stocks CBH and its constabnce range 200mill DSO and room for more.at mid 50c range and PSP at9 to 10c chasing 60 million of DSO. CUL with 30% of  10mill is now worth 14c according to the market so what are these two worth.?

must check out my record!


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## BREND

Iron ore market is facing a huge deficit, 25% price appreciation is expected in the next few month. 

CVRD is one huge supplier of iron ore: 
http://basemetal-trading.blogspot.com/2007/10/cvrd.html


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## marklar

Why bother digging it up? http://news.yahoo.com/s/nm/20071022/od_uk_nm/oukoe_uk_ironore_china_fish


> Mon Oct 22, 9:03 AM ET
> 
> SHANGHAI (Reuters) - It may not have the allure of trout fishing, but Chinese farmers are cashing in on the world metals boom by fishing with magnets for lumps of iron ore in local streams.
> 
> "It sounds unbelievable, but it really happens in many mining areas, including mine," a manager of a mine in the eastern province of Anhui said.
> 
> "They tie magnets to steel wires, and fish for waste iron ore in the streams," he added.
> 
> Domestic steel mills are happy to buy their "catch", since China's rapidly growing steel output has strained domestic mines while sky-high international shipping rates have pushed up the price of imported ore.
> 
> Many of the mines are located in rural areas and the waste ore washes downstream through farms.
> 
> Iron ore prices are expected to rise 25 percent starting April 1, 2008. according to a Reuters poll of 12 analysts, with some looking for a 50 percent hike in prices.



m.


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## cuttlefish

iron ore is only $80/tonne or so (higher depending on where sourced in china).

so they'd have to fish up a kilo of ore to get 8c - and would a mill buy a kilo of ore?


sounds a bit odd - maybe its a refined or semi-refined product that they're fishing for.


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## surfingman

I was just about to put the iron fishing rod in the car and go for a drive when i remembered, :nono: we live in Australia we don't have any flowing water


----------



## cuttlefish

In relation to Iron Ore some may be interested to know that Tony Schoer, the Managing Director of PLV has joined the forums and been posting responses to questions in the PLV thread.

PLV made a significant announcement yesterday in relation to an exploration permit being granted for the Irvine Island haemetite iron ore project in North Western Australia.  This is a follow on to the Native Title agreeent that was negotiated earlier this year.

PLV's 5th July ASX announcement provides interesting information about the potential of the iron ore deposit on Irvine Island - it is potentially hundreds of millions of tonnes of high grade, high quality DSO ore.

Irvine is adjacent to existing iron ore mining operations on Coc katoo and Koolan islands - both of these islands were mined for decades by BHP from the 50's and 60's through to the early 90's, yielding over 100 million of tonnes of high quality iron ore.  Both islands still have ongoing iron ore mining projects going on, now operated by PMM (Portman) and MGX (Mt Gibson) respectively.

These islands have Iron Ore grades up to 68% Fe.


----------



## chansw

*State releases Mid West iron ore sustainability strategy*
24-October-07 by Edited announcement

http://www.wabusinessnews.com.au/en-story.php?/1/57908/State-releases-Mid-West-iron-ore-sustainability-strategy

A State Government strategy for sustainable development in the Mid West has committed to the creation of Class A nature reserves over the Helena-Aurora Range, Die Hardy Range and Mt Manning Range.


Recommendations from the review are pasted below, followed by a government statement

As a result of this Strategic Review, Government will provide the confidence for mining, investment, community and conservation interests by demonstrating its support for the establishment of an environmentally acceptable long term iron ore industry base in the region by endorsing a framework that: 



commits to sustainable economic, social and environmental outcomes in respect to development proposals and conservation needs in the banded iron ranges;
provides for reservation as Class A conservation reserves (i.e. national parks, nature reserves or conservation parks) over appropriate areas of banded iron ranges;
provides clear indications that the Government is pre-disposed to the development of key strategic iron ore resources needed to underwrite and sustain the proposed Oakajee Port and related infrastructure;
provides guidance to the EPA and decision making authorities for the remaining ranges, including the objective of achieving appropriate conservation outcomes in high conservation value Midwest Ranges currently undergoing assessment.
provides adequate opportunity for further evaluation of prospectivity and conservation values to allow for informed decisions on land use.

Consistent with this framework the Government:


Commits to the creation of Class A nature reserves or national parks over the Helena-Aurora Range, Die Hardy Range and Mt Manning Range (as generally recommended in Bulletin No 1256), with an indicated pre-disposition against development of these ranges, 
Indicates its predisposition towards development over areas of 
- Jack Hills
- Weld Range
- Talledng Peak
- Yalgoo
- Wiluna West
where substantial iron ore resources are identified and are required to sustain a long term mining industry while also providing for an adequate level of conservation of their biodiversity values,

Indicates a predisposition that in the interests of sustainable economic development in the highly biodiverse Karara/Mungada Blue Hills area, to allow the development of the identified magnetite resource in the south west section of the range but the Government is not predisposed to the extraction of the hematite deposits of the area.
Further considers both the economic and biodiversity values present in the Koolanooka Hills when projects in this area come forward for assessment
Indicates its intention to place the
- Booylgoo 
- Bulga Downs
- Cashmere Downs
- Perrinvale
- Walling
- Warriedar/Pinyalling
- Wolla Wolla
- Lake Austin
- Bungalbin East

ranges into an appropriate reserve status (e.g. conservation park or nature reserve not of Class A) that will facilitate ongoing assessment of both biodiversity and prospectivity with a view to reviewing that status in 3 years in light of increased knowledge at the appropriate time.


Agrees that an updated strategic review of available information on biod[versity and mineral resource values in three years will make more specific recommendations for conservation reserves across the remaining BIF ranges in the Midwest and Goldfields regions with development proposal in these areas put forward in the interim to be considered on a case by case basis as required and with reference to the key principles,

Further, the Government will draw to the EPA's attention the Government's predisposition, as set out above, that exploitation of appropriate iron ore resources should be carried out sustainably by ensuring that critical thresholds for conservation of biodiversity are recognised in the consideration of development proposals and that best practise environmental management and mitigation programmes are committed to by developers.



The full text of a joint announcement by Resources Minister Francis Logan and Environment Minister David Templeman is pasted below

A landmark strategic framework that will provide for the long-term sustainable development of the Mid-West iron-ore industry has been endorsed by the State Government.

The framework was released today by Resources Minister Francis Logan and Environment Minister David Templeman.

Mr Logan said the framework would deliver the best possible outcome for the State by maintaining a balance between the development of an iron-ore industry and the conservation needs of the region.

It followed a strategic review of the mining and biodiversity values of the banded iron ranges of the Mid-West and Goldfields undertaken by the Department of Industry and Resources (DOIR) and the Department of Environment and Conservation (DEC).

Mr Logan said the framework identified areas where the State Government favoured mining development, preferred sites for conservation and other areas that required further investigation.

"This framework represents a responsible middle ground that maximises the potential of the Mid-West to share in the social and economic benefits of the resources boom, while maintaining a high degree of environmental responsibility," he said.

"We acknowledge that neither the mining industry nor the environmental sector has been given everything they wanted.

"We do not subscribe to the theory that the environment must be sacrificed for the benefit of industry - and vice versa.

"But responsible state governments need to make tough decisions and we have considered the conflicting interests in this case and delivered a fair and responsible outcome for the State.

"The two government agencies central to this announcement, DOIR and DEC, are to be commended for rolling up their sleeves and tackling what has been a very difficult and complex issue.

"There are still substantial challenges to be met before the Mid-West iron ore industry reaches its potential, but today's announcement successfully crosses one of the critical hurdles and provides some certainty for the future.

"The Carpenter Government is making decisions for the future to ensure the next generations can continue to share in the benefits of the booming economy and our precious environment."

Mr Logan said the unique banded iron formations ranges in the Mid-West were believed to contain between $50-80billion in mineral resources.

He said this quantity could sustain an iron ore industry with annual exports of 50-90 million tonnes, enough to underpin the development of a new port at Oakajee.

"World demand for iron ore is forecast to increase significantly in the next decade and, with much of the resources in demand located in the ranges, it is important that we plan for the future," Mr Logan said.

"This framework delivers that plan as a strategic approach to resource mining and biodiversity conservation decision making for the Mid-West and Goldfields."

Mr Templeman said the ranges also had significant biodiversity value due to their unique geology, soils and relative isolation and they hosted a number of rare and restricted plant species and communities.

"The ranges are also very distinct features in the regional landscape, so it is important that we have a strong balance between conservation and development needs of this area," he said.

Since 2002, the Environmental Protection Authority has completed formal assessments on three mining proposals in the region and is currently working on another three. There are a further three at the feasibility stage and 25 prospects under exploration.

Under the Environmental Protection Act, the EPA is limited to assessing only the environmental aspects of the proposals, while the State Government is responsible for the assessment of the broader issues of sustainability, environmental, economic and social costs and benefits. 

Mr Templeman said the large number of mining proposals in the region were presenting the EPA with an increasingly difficult challenge.

"This co-ordinated response will give industry greater certainty, while providing the EPA with clear guidelines about the economic and environmental objectives the State Government wants to achieve," he said.

"We must ensure examples of the banded iron landscapes are retained partially and in their entirety for their biodiversity and landscape values as well as tourism potential, while enabling responsible development in appropriate ranges.

"I also intend to consider how this document can be used to streamline the approvals process."


----------



## countryboy

PSP prosperity mines is about to confirm 50 to 60 million tonnes of direct shipping ore. Share Price for PSP is 10c to 11 c. Do your own research . got to be one of the last cheap iron ore play going


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## moneymajix

*NSL *

Iron Ore in India

See NSL thread and speeding ticket information.


See Artilce in the Oz today re iron ore and iron ore cos. including NSL

*Iron Ore could Double the Price*

http://www.theaustralian.news.com.au/story/0,25197,22662673-18261,00.html


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## BREND

I invest in the big boy: Companhia Vale Do Rio Doce, supplies 30% of iron ore to China.


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## grace

There is a nice write up in yesterday's Bulletin Magazine about iron ore stocks and the winners over the past year!


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## Dukey

Just read this worthwhile article about haematite versus magnetite Fe sources & the BHP/RIO game.  Well worth a read so I thought I'd re-post here in a more general Fe thread -( hope you don't mind R! )

This guy at least is convinced that Magnetite projects will struggle. 


> *Article posted by RIMTALAY on TTY thread
> 
> Rio could trample iron minors *
> By Tim Treadgold
> 
> 
> PORTFOLIO POINT: It’s plan to treble output of haematite, the higher-quality iron ore, would wreck the prospects of small magnetite producers.
> 
> 
> When elephants fight smaller animals run for cover. It’s the same in the corporate world, which an entire sub-sector of the iron ore business is about to discover as it becomes potential “collateral damage” in the battle between Rio Tinto and BHP Billiton.
> 
> Yes, the BHP move on Rio is good for iron ore stocks but only haematite iron stocks. For magnetite iron stocks, it's very bad news. And the magnetite iron sector houses some of the best known punters’ favourites in the mining industry. There's Gindalbie Metals and takeover target Midwest Corporation, along with Atlas Iron, Cape Lambert Iron, Grange Resources, Australian Resources and Goldstream Mining. If you have bought – or are about to buy into – any of these stocks think, again. Here's why:
> 
> Magnetite miners were already in trouble but this week's Rio Tinto defence has loaded the odds against them. Rio has revealed plans for a spectacular increase in the production of haematite, possibly trebling output from about 200 million tonnes a year to more than 600 million tonnes, with 420 million tonnes coming from the Pilbara region of WA.
> 
> That expansion, which represents a dramatic acceleration of mine development plans, is designed to give Rio Tinto a bigger slice of the world iron ore market than it already has. However, it also means much less room for new, high-cost, miners – and the newest and highest cost are the magnetite hopefuls.
> 
> Put simply, magnetite is an inferior ore to haematite – and it's haematite that's preferred by the world’s major iron ore exporters, including BHP Billiton, Rio Tinto and the big Brazilian, Companhia do Vale Rio Doce (CVRD) – and, from next year, Fortescue Minerals. It's also the iron ore preferred by all the miners in my October feature Iron ore’s hotter prospects.
> 
> Why are the magnetite miners heading downhill?
> 
> The ore itself contains much less iron. Typically, haematite grades 55–60% iron, while magnetite is 30–35%.
> Processing magnetite involves physical separation of the iron and the waste rock, and then intense heating, before conversion to a semi-finished product such as high-value pellets.
> While the physical separation process is easy (as the name implies magnetite is strongly magnetic), the heating requires very large amounts of energy – a luxury at a time when the oil price is approaching $US100 a barrel, and coal prices are rising in sympathy.
> The capital cost of magnetite processing is also high. None of the planned projects in Australia come in at less than $1 billion, and raising the debt component for all resource projects has become a lot harder as banks retreat under the sub-prime credit onslaught.
> 
> In a resources boom, when supplies are tight and prices high, mining and processing magnetite might make sense although very little of the material is transported over long distances without expensive upgrading.
> 
> Of course, those mining magnetite iron won't agree. True believers in magnetite argue that it is the iron ore of the future, that Chinese customers are comfortable working with it, and that Australia is endowed with vast deposits of the material.
> 
> They’re right on all three claims. The Chinese do want it, the outback of WA is littered with trillions of tonnes of the stuff, and it is an ore of the future.
> 
> But, those same Chinese steel mills that say they will buy magnetite, and are willing to invest in Australian projects, will soon be offered increased supplies of haematite thanks to existing expansion planned by CVRD and BHP Billiton, and even more now that Rio Tinto is running scared from BHP Billiton’s marriage overtures and seeks to impress its shareholders by expanding faster than anyone else.
> 
> 
> 
> The deciding factor for customers will be price and reliability of supply. On both of those measures haematite, whether from a mega-miner or one of the smaller producers, will be the winner.
> 
> What this means for stockmarket values is:
> 
> Companies offering a pure magnetite investment proposition, such as Grange, Cape Lambert, and Australasian will struggle. They might prosper in the future but it could be a very, very, long wait for a dividend cheque. Best advice: sell.
> Companies that offer a mixed haematite/magnetite investment proposition, such as Gindalbie, Midwest, and Atlas, are almost certainly over-priced. They will make money from selling haematite, but they will struggle to raise the capital or secure energy at a reasonable price to make the jump to magnetite production. Best advice: sell.
> Companies that are pure haematite propositions, even if small, have the appeal of production simplicity, and customer preference in their favour. Stocks such as BC Iron, Yilgarn Mining, and FerrAus are following the KISS principle of “keep it simple, stupid”. Best advice on KISS stocks: buy.
> 
> The debate over magnetite and haematite is broadly similar to the historic debate of replacing high-grade “sulphide” nickel ore with low-grade “laterite” ore, the key being that there is much more laterite ore in the world than scarce deposits of sulphide material.
> 
> But, that comparison fails two tests.
> 
> There is no shortage, yet, of haematite as Rio Tinto is demonstrating by casually rolling out a plan to triple output.
> Processing laterite ore has been a disaster for everyone who has tried it. Anaconda Nickel (now Minara Resources) was almost destroyed by design failures. BHP Billiton has been hit by a doubling in cost and time at its Ravensthorpe laterite nickel mine in WA.
> 
> Sad as it might be, the simple truth about mineral processing is that Australia is not very good at it. High internal costs, such as long transport distances, expensive labor (and potentially getting more expensive), and high energy costs mean that more processing plans fail than succeed.
> 
> In WA, an epicentre of the current global commodity boom, and a centre of past booms, there is an appalling record of processing failure with the common thread being high energy costs and distance from markets.
> 
> 
> 
> Today’s “magnetite promotion boom” has the hallmarks of booms (and busts) past.
> 
> Readers with long memories will recall the time when WA was going to be home to a number of steel mills. In fact, the requirement to build a steel mill is contained in the original iron ore access agreements signed with the WA Government in the 1960s by the corporate ancestors to the modern BHP Billiton and Rio Tinto.
> 
> There are no steel mills in WA. But there are: a failed blast furnace at Kwinana; two failed iron pellet-making plants; and a failed hot-briquetted iron plant (that almost crippled the John Prescott-era BHP). There might be a successful HIsmelt plant.
> 
> It’s the same with plans for petrochemical plants along the west coast (Alan Bond and the late Laurie Connell promised one of those); numerous chlor-alkali plants converting salt and natural gas into caustic soda and plastics feedstock (none yet); paper pulp plants; and aluminium smelters – to name the best, and least successful.
> 
> Magnetite, despite its undoubted potential, is just the latest boom-time commodity, and it faces the same hurdles as all previous west coast boom-time commodities:
> 
> Isolation and long transport distances.
> High energy costs.
> Poor, or non-existent, infrastructure.
> Dithering government.
> 
> Chinese demand for iron ore lies behind the rush to develop magnetite processing plants, and while one or two might be built they will be the high-cost source of iron and will deliver investment returns (if any) far below the simpler haematite mines of BHP Billiton, Rio Tinto and some of the smaller miners.
> 
> For the final test of this investment comparison between magnetite and haematite consider the level of involvement by BHP Billiton, Rio Tinto and CVRD in magnetite – zero. What else do you need to know?




# note :I'm not holding any Fe stocks at the mo.  Though will be sorely tempted again by GIR on further investigation - seeing they are targeting H-Fe. ... I know you're onto that one grace - good luck there - I may well join you sooner or later!!


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## brodion

Great reading good work thanks for the info.......................................................................................................................


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## moneymajix

December 20, 2007

*
Reduced Brazilian iron ore shipment to put pressure on Chinese market *


It is reported that Brazilian iron ore giant Vale has delayed vessels from taking shipments of iron ore from Brazil to China due to an accident that damaged a berth of a port in Rio de Janeiro state on December 8th 2007.

Earlier in November 2007, it has postponed some 15 to 20 shipments totaling 3 million tonnes from the ports of Ponta da Madeira in Brazil’s northern state of Maranhao and Ilha Guaiba in Rio de Janeiro state following problems include rains and the railway blockages. Vale has also resorted to other measures for slashing iron ore supply to China.

Brazil's ore shipment to China is estimated to reduce by 3 million tonnes to 3.5 million tonnes till January 2008. In this case, ore imports price is set to move up further in days to come on back of strong steel market and firm domestic ore concentrate price.

Meanwhile, China's domestic iron ore concentrate supply shortage has become more severe as Beijing tightens efforts in closing mini ore mines coupled with power disruptions and winter season. The EXW price for ore concentrate has reached a high of CNY 1600 per tonne in Tangshan. Market analysts expect domestic ore concentrate price to rise further in the first quarter of next year on supply shortage. A recovery in China's iron ore import market has sent up India's offerings for fines with 63.5% Fe content back to the previous peak of nearly USD 200 per tonne after hovering at USD 180 to 185 per tonne CFR for two weeks.

An iron ore trader in north China said that "After holding back for some time, medium and small sized steel mills have to return to the market to buy for their production."



http://www.steelguru.com/news/index...ipment_to_put_pressure_on_Chinese_market.html


----------



## moneymajix

http://www.guardian.co.uk/feedarticle?id=7233435

*Focus to shift to raw materials in '08 steel M&A*
Reuters 
Thursday January 17 2008 

By Humeyra Pamuk 

LONDON, Jan 17 (Reuters) - Steelmakers could focus their acquisition sights on raw materials in 2008, in a bid to reduce costs which are set to climb on the back of higher iron ore prices, a senior industry expert told Reuters this week.

The steel industry is bracing for a sixth straight year of iron ore price hikes in 2008 as annual contract talks between the mills and top iron ore producers Vale , BHP Billiton and Rio Tinto have begun.

The expectations in the market point to a 30 percent rise in the price of iron ore, a key raw material used to make steel, while industry sources in Australia have said Vale has offered an increase of 70 percent over current term prices.
"Those steel companies that are not self-sufficient in terms of raw materials will be seeking out raw materials-related companies," said Robert Miller, senior managing director of leading investment bank Miller Mathis, which advises the steel industry.
"There are a handful of major steel companies that are at or near self-sufficiency of raw materials but there are many that are still dependent on world markets," Miller said.
"I know of several major steel companies that are pursuing raw material acquisitions instead of focusing on buying primary producers," Miller said.
The world's sixth largest steel maker Tata Steel said it was looking for iron assets in the West Africa.
Arcelor Mittal , the world's biggest steel maker, has said it is aiming to lift its self-sufficiency in iron ore to 90 percent by 2018 from 47 percent today.

CHINA'S LIABILITY
In this picture, China, the world's top producer and consumer of steel, is among the countries which needs those raw materials the most.
Miller agrees.
"If I were in China I would certainly be looking at raw materials acquisitions because China's big liability is they have too few raw materials for a country of its size and stature," he said.
"What they need is to get raw materials to develop foreign markets for their products."
This need could prompt China to get involved in the possible takeover of Rio Tinto by the world's largest miner BHP Billiton , which could create a $350 billion plus mining giant.
"I personally think China should enter into the Rio Tinto transaction," Miller said. 
"Because Rio represents about 30 percent of China's annual iron ore needs. This is a once in a lifetime opportunity for China to acquire such a huge amount of iron ore."
Miller believes China will soon join the rest of the world in permitting market-based transactions.
"It would be quicker, easier and more cost efficient for China to achieve world-class capability in steel by allowing foreign steel companies to partner with domestic steel makers," he said.
Miller does not foresee any steel company taking drastic measures due to recession fears but thinks rising production costs could eventually curb enthusiasm for acquisitions.
"There comes a point where you cannot pass on these cost increases anymore, then it begins to hurt profitability and if that happens your stock price will go down and you will not be thinking as optimistically about acquisitions." Independent investment bank Miller Mathis has advised on $46 billion worth of steel M&A business in 2006 and $5.7 billion in 2007.

(Reporting by Humeyra Pamuk; Editing by Michael Roddy)


----------



## grace

Just wondering about thoughts on iron ore companies.
I hold
MMX (mining already - need new rail to ramp up)
BHP
FRS (hoping to start 2009)
BRM (hoping to start 2009)
GIR  (good holdings.  Hope someone will take them over when they spin-off their iron ore)

I see Sinosteel have just bought in over 10% of Mid-West (after close transaction).
Biggest problem with my holdings is infrastructure and pleading with FMG to use their rail line (BRM).   
Most iron ore stocks rallying.  MMX has been dissapointing of late (SP that is).


----------



## Wysiwyg

Well it is hard to see what impact this USA turmoil will have on our companies when this is being said .. 25/01/2008 ..



> ``*We still continue to see a strong market in China for all that we sell, and we don't see any signs of that changing*,'' Chief Executive Officer Tom Albanese said in an interview in Beijing today. He also reiterated Rio's rejection of BHP's previous three-for-one stock bid.
> 
> *China's economy expanded more than 11 percent for the fourth straight quarter, supporting global growth and demand for iron ore, copper and aluminum as a recession looms in the U.S.* Albanese is visiting China as iron ore producers are in talks with steelmakers to settle annual contract *prices, which may rise 70 percent*, Credit Suisse Group said this month.
> 
> *``In our view, if there was a possible recession in the U.S. it will only have about 1 percent impact on Chinese GDP*,'' Albanese said after visiting Chinese clients and officials. ``We continue to see strong market conditions and prices.''



I don`t like being too far away from knowing, but at present with the (USA sub-prime loans thingy & recession talk) it is wait and see for a bit with market trends for me.

Of course it is only interpretation of data we are fed  and over-reaction is still alive and well.


----------



## moneymajix

*Disruptions force up coal and iron *

Andrew Trounson | January 29, 2008 

FINANCIAL markets may be sweating on a US recession, but prices for Australia's bulk mineral exports, coal and iron ore, are soaring as a spate of supply disruptions reveals just how tight markets are.


http://www.theaustralian.news.com.au/story/0,25197,23123690-5005200,00.html




*PSP*


http://www.asx.com.au/asxpdf/20080125/pdf/31735784z81rmn.pdf

RE: DRILLING TO COMMENCE AT WOOLSHED IRON ORE PROSPECT, MT GIBSON/YALGOO 
OPTION AGREEMENT LAPSES

10c


----------



## kpas

BRM due to announce resource upgrade in Febuary.

Worth a look as it's SP has dwindled a little with the current US situation.

I need to go over old announcements to confirm it, but I beleive they are currently pushing to have a rail agreement in place by mid 2008 as well which should concrete their position further as a junior iron ore miner.


----------



## grace

kpas said:


> BRM due to announce resource upgrade in Febuary.
> 
> Worth a look as it's SP has dwindled a little with the current US situation.
> 
> I need to go over old announcements to confirm it, but I beleive they are currently pushing to have a rail agreement in place by mid 2008 as well which should concrete their position further as a junior iron ore miner.




I hold.  MOU with FMG is their best option so I read, although BHP rail line goes straight though their holding.  Not much luck hitching a ride there though.  I believe they are trying to get that MOU this year with FMG.  MD supposed to have connections (ex BHP iron ore), as well as working on FMG with twiggy.  I'll believe it when I see the MOU though.  Hoping to start mining 2009.


----------



## kpas

grace said:


> I hold.  MOU with FMG is their best option so I read, although BHP rail line goes straight though their holding.  Not much luck hitching a ride there though.  I believe they are trying to get that MOU this year with FMG.  MD supposed to have connections (ex BHP iron ore), as well as working on FMG with twiggy.  I'll believe it when I see the MOU though.  Hoping to start mining 2009.




Also read somewhere that the ACCC was talking about pushing BHP to allow juniors access to it's infrastructure as a condition of the RIO merger? I should dig out a reference for this because it is a good read.

http://www.thewest.com.au/default.aspx?MenuID=32&ContentID=47292 (This is not the one I was thinking about, but its close)


----------



## chewy

Reports that contact price agreement has been reached at +65%.

http://uk.reuters.com/article/oilRpt/idUKL176439220080217

UPDATE 1-Nippon Steel agrees to 65 pct iron ore price rise
Sun Feb 17, 2008 4:09pm GMT  

BEIJING, Feb 17 (Reuters) - Japan's Nippon Steel (5401.T: Quote, Profile, Research) has agreed to a 65 percent rise in the price it will pay for iron ore under term contracts, effective April 1, industry sources and a Chinese steel industry website said on Sunday.

Term iron ore prices had been widely expected to rise by 50 percent or more, after spot prices soared to record highs in 2007 and Chinese steel mills' demand showed no signs of abating.

The rise could squeeze margins for the steel industry, which is already facing rising costs for coke, coal, and shipping.

"An international steel mill has concluded 2008 iron ore negotiations. The 2008 iron ore price will rise by 65 percent," steel industry website Umetal said late on Sunday.

Industry sources said Nippon Steel had concluded the deal. That company could not be reached on Sunday evening.

Traditionally, all steel mills accept whatever price is first settled by any steel mill and one of the three top miners, Brazil's Vale (VALE5.SA: Quote, Profile, Research) or Australia's Rio Tinto (RIO.L: Quote, Profile, Research)(RIO.AX: Quote, Profile, Research) and BHP Billiton (BHP.AX: Quote, Profile, Research)(BLT.L: Quote, Profile, Research).

Li Xinchuang, vice president of the China Metallurgical Industry Planning and Research Institute, confirmed a price had been set but did not confirm which companies nor what price level.

A deal would be announced this week, Chen Xianwen, deputy general director of the China Iron and Steel Association, said on Sunday, while also declining to confirm the price or parties to the deal.

When asked if Chinese mills would accept a price settled by their Japanese counterparts, Chen said they would. "That's how the system works."

Steel mills had argued that an increasingly gloomy global economic picture justified limiting the additional amount they would pay for iron ore. But miners pointed to 16 percent rise in Chinese crude steel production last year and ongoing production and transport disruptions as supporting iron ore prices for the foreseeable future.

"We had expected 50 percent, but that was a conservative estimate. A 65 percent rise is very reasonable," said analyst Henry Liu of Macquarie Research.

Miners have chafed as spot prices for inferior grades of iron ore far exceeded the Australian and Brazilian ore sold under term contracts.

Rio Tinto, which is fighting off a takeover proposal by BHP, has said it would like to move to an index pricing system that would better reflect spot prices.

Chinese mills last year signed the deal for the first time, arguing that as the world's largest consumer of iron ore, China should have the first say in setting prices. The nation's top steel maker, Baosteel (600019.SS: Quote, Profile, Research), leads negotiations for the Chinese industry. (Reporting by Lucy Hornby; Editing by Paul Bolding)


----------



## ithatheekret

Nippon Steel , Japans biggest steel maker has reach prelim. agreement with CVRD for a 65% increase in the ore price according to a Thompson Financial flash .


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## mick2006

the 65% iron ore increase tops most analysts estimates, expect to see some strength in the sector over the coming weeks as analysts/brokers start increasing their price targets on companies such as FMG/MMX/MIS/TTY/SDL


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## ithatheekret

I read the post above mine . noted the flash from yesterday , and thought , hmmmm , they must have tried for a little higher  and had to make do with a preliminary agreement .

Soon the calls on a steel slump and iron ore build up ( coal build up ) will emerge from certain brokerage houses .............


----------



## Tiberium

As you guys may already know that FDL is sandwiched between two of the biggest names in the iron ore industry with Rio and FMG. I’m interested to know if there was other junior iron ore explorer beside FDL which is located not far from FMG and FDL tenements. Can someone please help? Thank you.


----------



## kransky

lots of juniors are located right next to BHP and RIO... they all applied for the tenements around the existing Fe mines..

BRM, UMC, GIR ...


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## habs

does anyone know when the new iron ore terms are negotiated with bhp and rio? everyone is talking about this 65% price rise with the japanese steel company, but when does the all round price rises get confirmed and take place...?


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## Broadside

Tiberium said:


> As you guys may already know that FDL is sandwiched between two of the biggest names in the iron ore industry with Rio and FMG. I’m interested to know if there was other junior iron ore explorer beside FDL which is located not far from FMG and FDL tenements. Can someone please help? Thank you.




like Kransky says, take a look at UMC...they've also done just a tad more drilling than FDL(!)  and have more than just a conceptual target  another good announcement today, just a matter of time before the wider market catches on.  Next to no interest in this stock at ASF.


----------



## Yeti

Tiberium said:


> As you guys may already know that FDL is sandwiched between two of the biggest names in the iron ore industry with Rio and FMG. I’m interested to know if there was other junior iron ore explorer beside FDL which is located not far from FMG and FDL tenements. Can someone please help? Thank you.




BCIron:   http://www.bciron.com.au

BCI was formed in July 2006 to explore for and develop iron ore resources within
the Nullagine Project in the Pilbara Region of Western Australia. The Project is
an amalgamation of fourteen adjoining tenements held separately by ALK and
CSM, and covers approximately 1,500km² of prospective ground for Channel Iron
Deposits (CID s)
The tenements are strategically located 50 to 100 km east of BHP Billiton s
( BHP ) existing rail infrastructure and just 20 to 30 km north of Fortescue Metals
Group Ltd ( FMG ) proposed operations at Christmas Creek and Cloud Break.
The proposed rail line passes through BC Iron s western most tenement and the
existing road between Mt Newman and Nullagine passes within 10 km of the
pBC channel system.
The proximity to this important infrastructure potentially reduces capital costs for
an operation and makes any development scenario less onerous.
Within the tenements, 90 kms of pisolite bearing paleaochannel has been
identified in three separate project areas, with potential to realise significant
tonnages of CID.


----------



## Tiberium

Yeti said:


> BCIron:   http://www.bciron.com.au
> 
> BCI was formed in July 2006 to explore for and develop iron ore resources within
> the Nullagine Project in the Pilbara Region of Western Australia. The Project is
> an amalgamation of fourteen adjoining tenements held separately by ALK and
> CSM, and covers approximately 1,500km² of prospective ground for Channel Iron
> Deposits (CID s)
> The tenements are strategically located 50 to 100 km east of BHP Billiton s
> ( BHP ) existing rail infrastructure and just 20 to 30 km north of Fortescue Metals
> Group Ltd ( FMG ) proposed operations at Christmas Creek and Cloud Break.
> The proposed rail line passes through BC Iron s western most tenement and the
> existing road between Mt Newman and Nullagine passes within 10 km of the
> pBC channel system.
> The proximity to this important infrastructure potentially reduces capital costs for
> an operation and makes any development scenario less onerous.
> Within the tenements, 90 kms of pisolite bearing paleaochannel has been
> identified in three separate project areas, with potential to realise significant
> tonnages of CID.




Thanks Yeti. I have been holding BCI since the last two week, when it was $1.15; I bought it only because it's located in Pilbara :. BCI has exploration target of approx. 45Mt (58%Fe) but I’m assuming the tonnage could be higher after the resource estimation on the Outcamp Well and Coongan Well prospects in this quarter. Thanks a bunch to Kransky and Broadside who have introduced UMC to me, it definitely has slipped through my net. Pilbara is a very promising location for every iron ore explorer there, including BRM.


----------



## grace

Tiberium said:


> Thanks Yeti. I have been holding BCI since the last two week, when it was $1.15; I bought it only because it's located in Pilbara :. BCI has exploration target of approx. 45Mt (58%Fe) but I’m assuming the tonnage could be higher after the resource estimation on the Outcamp Well and Coongan Well prospects in this quarter. Thanks a bunch to Kransky and Broadside who have introduced UMC to me, it definitely has slipped through my net. Pilbara is a very promising location for every iron ore explorer there, including BRM.




Also, Giralia have got another deposit next door to BCI (to the North).  They will be drilling on 5 deposits fairly soon (4 at present)
- Western Creek (next to BHP at Newman)    DRILLING nice hits already
-  Weld Range (next to MIS)   DRILLING + jorc
-  Earaheedy inland from Wiluna  DRILLING  +1billion tonne target  80km from proposed rail line to Mid-West   
- 15 km south of Weld range   DRILLING   target 30-50 million tonne
- another deposit north adjoining BCI (can't remember the name)

I also hold BRM.  Heard a rumour results won't be out there for another 2 weeks (was to be Feb 08).
Hold FRS too.  It's got a target of 200 million tonne of DSO.  News due Feb 08 there too not yet in.

Just some food for thought.


----------



## Sean K

grace said:


> Also, Giralia have got another deposit next door to BCI (to the North).  They will be drilling on 5 deposits fairly soon (4 at present)
> - Western Creek (next to BHP at Newman)    DRILLING nice hits already
> -  Weld Range (next to MIS)   DRILLING + jorc
> -  Earaheedy inland from Wiluna  DRILLING  +1billion tonne target  80km from proposed rail line to Mid-West
> - 15 km south of Weld range   DRILLING   target 30-50 million tonne
> - another deposit north adjoining BCI (can't remember the name)



Surely Giralia is going to spin all of this out like they have with their other running assets...


----------



## grace

kennas said:


> Surely Giralia is going to spin all of this out like they have with their other running assets...




Yes, I'm sure they will.  They will prove up somewhat, so the projects look nice going forward.  Spin-out and probably raise some funds for further work.  If they spin out each one, that is going to be a lot of new companies.  Giralia always tries to retain a fair share in the newly created one, and often distribute bonus shares back to Giralia holders so you stay with them as well.  Should be an interesting year for them with the iron ore hunt on for one and all!  I personally believe they have more going for them than Sundance, and much cheaper market cap even just on a pure iron ore play(for reasons stated before).   They do have other non iron ore assets too.

Guess I should be posting this on GIR's thread....oops.


----------



## Tiberium

grace said:


> Also, Giralia have got another deposit next door to BCI (to the North).  They will be drilling on 5 deposits fairly soon (4 at present)
> - Western Creek (next to BHP at Newman)    DRILLING nice hits already
> -  Weld Range (next to MIS)   DRILLING + jorc
> -  Earaheedy inland from Wiluna  DRILLING  +1billion tonne target  80km from proposed rail line to Mid-West
> - 15 km south of Weld range   DRILLING   target 30-50 million tonne
> - another deposit north adjoining BCI (can't remember the name)
> 
> *I also hold BRM*.  Heard a rumour results won't be out there for another 2 weeks (was to be Feb 08).
> Hold FRS too.  It's got a target of 200 million tonne of DSO.  News due Feb 08 there too not yet in.
> 
> Just some food for thought.




Congratz to you Grace and all the holders of BRM! BRM has finally borne very very big fruit  I had BRM when it was only $0.80, this arvo it was just happening by chance I looked at ASX site and BRM's headline was on top of the list : otherwise I wouldn't be aware of the good news. I'm now looking at TRH (Transit Holdings), if I'm not mistaken TRH's location is near major players, such as Portman Mining. Good luck and good night all!


----------



## grace

Thought I would post this here - Patterson's report on some of the junior iron ore explorers.  

http://www.minesite.com/fileadmin/c...s_June/Pilbara_Iron_Ore_Developers_170608.pdf

It is worth a read.  I disclose holding BRM and FRS of those mentioned.


----------



## michael_selway

grace said:


> Thought I would post this here - Patterson's report on some of the junior iron ore explorers.
> 
> http://www.minesite.com/fileadmin/c...s_June/Pilbara_Iron_Ore_Developers_170608.pdf
> 
> It is worth a read.  I disclose holding BRM and FRS of those mentioned.





Hi Grace, thanks great overview article

thx

MS


----------



## grace

Here is Ocean Equities new July review of varous iron ore stocks.

I disclose holding BRM, FRS, GIR, UMC of those mentioned.

Current share prices have slipped since this report (eg BRM below $2 now)

It's a long document, and I haven't read it all yet!

http://www.minesite.com/fileadmin/c...n_Ore_Sector_Update_July08_Ocean_Equities.pdf


----------



## Atma

grace said:


> Here is Ocean Equities new July review of varous iron ore stocks.
> 
> I disclose holding BRM, FRS, GIR, UMC of those mentioned.
> 
> Current share prices have slipped since this report (eg BRM below $2 now)
> 
> It's a long document, and I haven't read it all yet!
> 
> http://www.minesite.com/fileadmin/c...n_Ore_Sector_Update_July08_Ocean_Equities.pdf




sector getting smashed. slipped is an understatement. only UMC(best of the bunch) is good. rest are no good!


----------



## Sean K

Atma said:


> sector getting smashed. slipped is an understatement. only UMC(best of the bunch) is good. rest are no good!



Nice piece of analysis to come to that conclusion Atma. Great work.


----------



## fordxbt

id better sell the lot then


----------



## grace

IOH securing mine gate sales to RIO in the Pilbara.  Is this a first, as I can't recall anyone making such an agreement?

http://aspect.comsec.com.au/asxdata/20080724/pdf/00862786.pdf


----------



## Spaghetti

I have been trying to find a nice iron ore stock and the rail acess annoys me no end. Here we have so much capital, staff, lab work tied up that is well needed elsewhere if there is never ever going to be transport options available. I think the government should build railways and ports. Then they charge the users, so user still pays but ownership is in the national interest.

We have so many delays and staff shortages creating cost pressure yet we tie up these resources in a sector that is unsure of it's future.

Poor government imo.


----------



## grace

All of the iron ore juniors suffering utter carnage, and mine particularly today.  This sector, and the coal seam gas sector, are the only two sectors I have real faith in over the next 2 - 3 years, so I hope I'm not wrong!

Would love to hear others' thoughts.


----------



## Spaghetti

Grace

I agree, well if bulk commodities do not survive whole aussie economy down the porcelain.  I see major institutions going from one sector to another, atm they are saying the resource sector did not get the correction other sectors got earlier this year so now their turn. Not sure there is anymore logic behind the goings on than that. The boom may well be over but still will be healthy. Depends on definition of boom I guess. I do know some iron ore stocks I wanted to buy did not seem to offer potential of huge returns in the immediate future and speculative stocks' main attraction are huge gains. So I will wait atm for a nice low entry point and just hope I pick the winning stock.


----------



## grace

Spaghetti said:


> Grace
> 
> I agree, well if bulk commodities do not survive whole aussie economy down the porcelain.  I see major institutions going from one sector to another, atm they are saying the resource sector did not get the correction other sectors got earlier this year so now their turn. Not sure there is anymore logic behind the goings on than that. The boom may well be over but still will be healthy. Depends on definition of boom I guess. I do know some iron ore stocks I wanted to buy did not seem to offer potential of huge returns in the immediate future and speculative stocks' main attraction are huge gains. So I will wait atm for a nice low entry point and just hope I pick the winning stock.




Well, looks like China is going to die immediately after the Olympics are finished, and they will no longer need any of our resources.  Brokers are pushing the banks at the moment.  I disagree with their verdict.  I don't own any Bank shares, nor will I for a few more years.  Hope I'm right.


----------



## Spaghetti

The olympics is funny. More like more iron ore discoveries if anything. Also read far more recycling due to high steel prices. So I see a few reasons for iron ore sector to come off boil but the olympics is not one of them. lol Wonder how much these people get paid to come with such rubbish.


----------



## Spaghetti

Have been trying very hard to find a good little stock out there. Hard. When you see what iron ore is keenly sought you see RIO, BHP and FMG all with grades between 60% and 64% , makes the others look quite woeful. 

CID seems complicated, was reading how BHP took years of testing to satisfy the requirements of it's japanese customer. Is this a common problem and why some CID explorers are so cheap? Think you need to be very knowledgeable to know which maybe good. Maybe reason I cannot understand why BCI has such a small market cap..or another reason?

Maybe I am being too selective but those that are not close to mining may have to have really high grade resource at quite high tonnage to make it. I cannot find one that meets my criteria atm. A couple may in time but...maybe a big ask.


----------



## Tiberium

Just read ocean equities ltd’ iron ore report, I’m still bamboozled with how iron ore deposit was distinguished between Marra Mamba, CID and Brockman iron ore type. I only know is if an explorer has iron ore deposit >55% Fe grade and low impurities, it could mean that this explorer has saleable and profitable iron ore deposit. I wonder how the experts know how to perceive which explorers or producers have Marra Mamba, CID or Brockman iron ore type. Could anyone please help? Thank you.


----------



## grace

Tiberium said:


> Just read ocean equities ltd’ iron ore report, I’m still bamboozled with how iron ore deposit was distinguished between Marra Mamba, CID and Brockman iron ore type. I only know is if an explorer has iron ore deposit >55% Fe grade and low impurities, it could mean that this explorer has saleable and profitable iron ore deposit. I wonder how the experts know how to perceive which explorers or producers have Marra Mamba, CID or Brockman iron ore type. Could anyone please help? Thank you.




Here's some comment from Ocean equities again.  They like Atlas and Ferraus (I hold FRS).  They also mention a few others at the bottem (I hold BRM).



> Iron ore juniors still a good bet
> -----------------------------------------------------------
> Wednesday, 20 August 2008
> 
> LONDON-based broking firm Ocean Equities says that despite the plunging market, the junior end of the Australian iron ore sector still offers value for investors. By Kate Haycock
> 
> The company, which specialises in small and mid-cap mining stocks, said iron ore juniors still represented a solid investment opportunity despite volatility in resource equity.
> 
> The brokerage noted that Rio Tinto’s recent win with the Chinese in gaining the freight premium – which passed on to BHP Billiton and Australia’s newest iron ore miner, Fortescue Metals Group – further de-risked the sector and was a formal recognition of the greater value-in-use of Australian iron ore.
> 
> Analysts at the company said the freight premium set a precedent for longer-term pricing that was expected to continue beyond 2009.
> 
> “Given the higher-cost freight environment and longer-term outlook for the oil price, freight appears set to become an ever increasingly significant component in the total cost of steel production,” the brokerage said.
> 
> The firm also predicted next year’s negotiations would be just as tense, with Australians again pushing for a higher recognition of the freight differential.
> 
> “We believe the break in the traditional price negotiation process will result in an aggressive resumption of negotiations into [the next Japanese financial year] as the Australian majors attempt to gain further benefit from the freight cost differential and further close the gap between the annual contract and spot price mechanisms,” the brokerage said.
> 
> The freight premium also would partly insulate the iron ore sector against the risk of a contraction in iron ore pricing in the medium to long term, offering further support to the junior iron ore sector.
> 
> Meanwhile, iron ore miners would continue to take advantage of the new over-the-counter iron ore market established by Credit Suisse and Deutsche Bank.
> 
> The shortfall in ore supply in relation to demand would continue, with another 50-60 million tonnes per annum to be required by Asian steelmakers in the medium to long term – both factors boding well for the continued strength of iron ore as a commodity and an investment opportunity.
> 
> “This [rising demand] is effectively the equivalent of 1.1 to 1.23 new Fortescue’s coming onstream each year,” analysts at the company added.
> 
> Out of the junior iron ore sector, the brokerage said the change in contract pricing to a higher value for lump ore over fines had increased the Australian premium for this product to around 40%.
> 
> This could be expected to continue, Ocean Equities said, if shipping costs continue to rise, with lumps representing better value in transporting.
> 
> As a result, the premium for lump ore could be expected to widen in coming years, which will continue to favour companies with higher-grade, lower impurity deposits.
> 
> Nevertheless, with the higher-quality Brockman deposits becoming depleted in the Pilbara, other deposits – such as the Marra Mamba style of ore, and Yandi or Channel Iron Deposits – will continue to produce a growing quantity of the Pilbara’s ore.
> 
> Ocean Equities said given the increasing importance of higher grade and lower impurities, its pick of the juniors included Perth-based Atlas Iron and Adelaide-based FerrAus due to their estimated lump to fines product ratios.
> 
> Atlas is targeting production of 1 million tonnes per annum from the Pardoo operation, beginning in December. When additional direct shipping ore export tonnages start arriving from the Abydos project, the company is targeting exports of 6Mtpa by 2010 and 12Mtpa DSO by 2012.
> 
> FerrAus, meanwhile, has two key projects in the Pilbara: Davidson Creek and Robertson Range, which it hopes to bring into production in 2009 to ship some 6Mtpa by 2012, increasing to 10Mt in 2014, and up to 20Mt by 2017.
> However, the brokerage warned potential investors in the sector to carefully consider the major impediment to any junior play wanting to establish an exporting mine – infrastructure.
> 
> The brokerage came down firmly on the side of juniors pushing for third-party railway access, and said that while the Western Australia government’s push to open access was welcomed, it was in the interests of the major miners and juniors to come to a suitable agreement among themselves – such as that recently signed by Rio Tinto and Iron Ore Holdings.
> 
> Atlas and BC Iron were well-placed in terms of infrastructure and memorandums of understanding with FMG over its rail and port system, while Brockman and Iron Ore Holdings were best placed to strike deals with BHP and Rio, the company added.
> 
> The brokerage also suggested keeping an eye on leading Asian steel makers looking for further “upstream integration” and further acquisitions, joint ventures and off-take deals would be expected in the Australian iron ore industry in coming months and years.


----------



## MR.

Thought some may find the following of some interest. If you have more up to date figures, let me know. 

And I still hold GRR.



Magnetite Iron Ore concentrate comparisons:

GBG ground to 25 microns = 68.5% FE, 4.00% SIO2, 0.08% Al2O3, 0.012 Phosphorus 

ARH ground to 32 microns = 67.5% FE, 4.50% SIO2, 0.09% Al2O3, 0.030 Phosphorus

CFE ground to 26 microns = 66% FE, 5.8% SIO2, 0.45% Al203, 0.010 Phosphorus 

SPH ground to 45 microns = 70.8% FE, 1.24% SIO2, (West Africa)

GRR ground to 38 microns = 68.8% FE, 2.06% SIO2, 1.41% Al2O3, 0.003 Phosphorus
GRR ground to 35 microns = 69.7% FE, 1.00% SIO2, 1.39% Al2O3, 0.005 Phosphorus




GBG info' from 30/4/07 page 1 http://www.asx.com.au/asxpdf/2007043...s8fz5bstdp.pdf

ARH info' from 17/7/08 page 3 http://www.asx.com.au/asxpdf/2008071...lkdfsmlr03.pdf
May08 http://www.austresources.com.au/pdf/...esentation.pdf

CFE info' from 14/02/08 page 2 http://www.asx.com.au/asxpdf/2008021...mq5vmjsr41.pdf

SPH info' from 31/10/07 page 7 http://www.asx.com.au/asxpdf/2007103...r6xdy8qlcv.pdf

GRR info' from 28/7/08 page 3 http://www.asx.com.au/asxpdf/2008072...bnntbl048x.pdf
05/5/08 page 24 http://www.asx.com.au/asxpdf/2008050...vy46wpgkvn.pdf


----------



## MR.

Rumours: 3/9/08
So its not a further 20% on the total price of iron ore to China from Brazil.  However a 20 percentage point rise still increases the price over 2007 prices.  The prices were 65% and 71% but now for China could be 86% and 92%.  But Vale "does not confirm rumors.''

http://www.bloomberg.com/apps/news?pid=20601086&sid=aB0cHqTII.Cw&refer=latin_america


----------



## chansw

*Vale hits China with 20% ore price rise*
By Patti Waldmeir in Shanghai and Javier Blas in London

Published: September 6 2008 03:00 | Last updated: September 6 2008 03:00

http://www.ft.com/cms/s/0/2d93908a-7bab-11dd-b839-000077b07658.html

Vale of Brazil, the world's largest iron ore miner, has asked Chinese steelmakers to pay as much as 20 per cent more for ore supplies in an unprecedented move in the middle of an annual contract.

The request comes well ahead of April 2009, when new prices would traditionally apply, and in spite of a slowdown in economic growth. Iron ore prices surged earlier this year by the largest annual amount ever.

Chinese industry officials said this week that Vale had sent letters to several Chinese mills demanding an additional midcycle price increase of between 13 and 20 per cent from September 1. The increase is on top of a 65-71 per cent rise in February.

In June, Australian miners won a price increase of up to 96 per centafter negotiations with Chinese mills, to reflect the lower cost of shipping ore from Australia. Traders said that Vale's demand for an additional 20 per cent rise could partly reflect a drop in freight costs, which means that Brazilian ore delivered in China is now cheaper than earlier this year.

Vale declined to comment, only saying it was "constantly dialoguing with clients".

Analysts said Chinese mills oppose an increase because of fears domestic demand is slowing. But if they did pay more, they were likely to pass any costs rises on to customers, so driving up the price of goods such as cars or washing machines.

Baosteel, which negotiates with miners on behalf of the Chinese mills, said it was preparing a response to Vale's demand.

Additional reporting by Song Jung-a in Seoul , Yan Jin in Shanghai and Jonathan Wheatley in SÃ£o Paolo

Copyright The Financial Times Limited 2008


----------



## sam76

I believe Brazil have a much lower impurity level than the rest of the world.

ie; it's the best of the best.


----------



## MR.

Rio de Janeiro, September 9, 2008 – Companhia Vale do Rio Doce (Vale), in compliance with a determination of Brazil’s ComissÃ£o de Valores MobiliÃ¡rios (CVM), informs that it is negotiating with Asian clients the convergence of reference prices for iron ore to the same level of those charged to European clients. Currently, reference prices for Asian clients are 11.0% to 11.5% lower than prices for Europe, depending on the type of iron ore.

http://www.vale.com/vale_us/cgi/cgilua.exe/sys/start.htm?infoid=2393&sid=554


----------



## chansw

*Kumba doubles iron-ore benchmark export price *

By: Creamer Media Reporter 
Published on 3rd October 2008 
Updated 4 hours ago

http://www.miningweekly.com/article.php?a_id=144417

JOHANNESBURG (miningweekly.com) – JSE-listed Kumba Iron Ore (KIO) on Friday announced that it had concluded its benchmark price negotiations for the 2008/9 iron-ore year.

The producer expected the average benchmark export price for its products to increase by between 100% and 110% on a rand-a-ton basis.

This was owing to the higher lump-ore weighting of KIO’s product mix, together with a weakening of the rand.

The South African miner, a subsidiary of Anglo American, noted that the prices were well aligned with leading settlements reached by other iron-ore producers earlier this year. 

The world’s largest iron-ore producer, Brazil’s Vale, agreed price increases between 65% and 71% with large steelmakers in the first quarter of the year. 

BHP Billiton agreed a 97% increase in July, while Rio Tinto secured a 96,5% price rise in June. The agreed price increases were effective from April 1.

KIO commercial head Tino Smit said during a presentation in July, that the company expected the prices for iron-ore to remain strong for the next three to five years, as the world’s miners would battle to keep up with demand.

Demand for the steelmaking ingredient was mainly driven by growing Chinese consumption. China represented over 50% of the seaborne iron-ore market.

KIO’s share price gained more than 4% in early morning trade on the JSE, trading at R183,24 a share by 10:00.


----------



## grace

Iron ore stocks have been smashed.  FRS announced a very large upgrade during the week, and I think the price didn't even go green.  UMC had some good news too, it did at least get a green day.

I think most stocks are only about 1/3 of what they were.  Some, like BRM's share price are sitting on cash backing only.

I guess they are being rated as if their projects won't get there.

I wish I had a crystal ball that worked!


----------



## agro

grace said:


> Iron ore stocks have been smashed.  FRS announced a very large upgrade during the week, and I think the price didn't even go green.  UMC had some good news too, it did at least get a green day.
> 
> I think most stocks are only about 1/3 of what they were.  Some, like BRM's share price are sitting on cash backing only.
> 
> I guess they are being rated as if their projects won't get there.
> 
> I wish I had a crystal ball that worked!




you find the likes of BRM and FRS will get eaten up by the Big boys - BHP, RIO, FMG


----------



## grace

agro said:


> you find the likes of BRM and FRS will get eaten up by the Big boys - BHP, RIO, FMG




Agro, there are some juniors around with nice resources.  I've chosen on the basis of location to infrastructure ie transport.  

Share prices are so cheap now, I'm guessing that if those three big boys don't make a move, asian money will scoop up some deposits way too cheaply.  

Hope our government doesn't continue to let that happen.


----------



## Miner

Talking some of the decision makers in Governor Stirling Place and St Georges Terrace of Perth in last few days / weeks I think many small and mid cap iron ore producers are just looking for fund. Which making their projects not onlydelayed but also less viable with lesser demand, higher interest and tendency to see more small suppliers with little economy of scale

There is fear of recession to have come two years earlier. 

Job advertisements are not any more glowing. 

Big players like Rio and BHP are not increasing their worth

So the return on investment is coming slower and lower


----------



## noirua

The ASX quarterly report for MGX today does show that buyers are asking for delays in shipments of iron ore. Contractual or not, suppliers may have to fall into line or reduce production shortly. With the falling Aussie Dollar, (contracts being priced in US$'s) discounts may have to be agreed.


----------



## noirua

Vale have just announced that they are cutting iron ore production by 30mtpa below their 2007 level.
Iron ore prices have fallen from US$200 per tonne to US$70 per tonne.
http://www.aireview.com.au/index.php?act=view&catid=8&id=9363


----------



## adobee

In regard to the recent large drops in demand for Iron Ore from China everyone thinks this is fully reflective of the current market and economy and has nothing to do with the Chinese government manipulating the share price and value of miners so that they can get a larger foothold.. If it is currently so dyre for Australian miners why is it that the Chinese are the only ones buying in...


----------



## noirua

adobee said:


> In regard to the recent large drops in demand for Iron Ore from China everyone thinks this is fully reflective of the current market and economy and has nothing to do with the Chinese government manipulating the share price and value of miners so that they can get a larger foothold.. If it is currently so dyre for Australian miners why is it that the Chinese are the only ones buying in...



Companies are having problems as the Chinese renege on iron ore agreements by refusing deliveries. This is putting Australian miners in dire straights as they try to dump ore at what ever price they can get. In these markets borrowing or raising cash is difficult.

BHP Billiton are steaming on with iron ore production and this will hit smaller iron ore miners even harder.


----------



## noirua

ArcellorMittal has just announced that it is cutting steel output by one third.  The company cited demand falls in the housing sector and for cars.


----------



## noirua

Corus owned by Tata Steel, is cutting crude steel production by 30% or 1.5mtpa, in the next few months, at two UK blast furnaces and one in Holland.


----------



## Reealjrd

noirua said:


> Corus owned by Tata Steel, is cutting crude steel production by 30% or 1.5mtpa, in the next few months, at two UK blast furnaces and one in Holland.




Hello noirua,

I don't know much about Iron or steel but thanks for the news. I have been trading in commodities but never traded in Iron or Steel as didn't find these commodities safe.


----------



## Miner

noirua said:


> Corus owned by Tata Steel, is cutting crude steel production by 30% or 1.5mtpa, in the next few months, at two UK blast furnaces and one in Holland.




More to that Tata Steel also owns Jaguar (vertical integration of using steel into car manufacturer), significant holders of Riversale Mining (RIV) means acquiring coking coal for their blast furnaces and got few things more in Australia

They are in stiff competition with Mittal Steel and the difference is Tata is more professionally managed and respected for good corporate governance . The actual ownership of Tatas in Tata Steel is however less than 4 percent


----------



## noirua

Rio Tinto have announced a reduction of 10% in iron ore shipped from its Pilbara mines.


----------



## Reealjrd

Well friends can somebody tell me about how to trade in iron ore.


----------



## MR.

Small business "Drum Brokers Australia" (scrap steel) claim scrap steel has come down from $420- per tonne to $70 per tonne last week.  They expect they will be getting $40- per tonne this week.


----------



## Sean K

One report does not make a change but interesting nonetheless.

There's probably another report out there somewhere countering it...

*China fixes vessels for India ore *
November 25, 2008 

CHINA has chartered 17 vessels to import nearly one million tonnes of Indian ore since November 17, Imarex has noted.

“China could be showing they have more iron ore and steel demand than most currently believe,” Norwegian-based Imarex, the world's largest shipping derivatives trader, said in its report. 

“Or, they could just be building up stocks to ensure 2009 contract prices are secured at a hefty discount (Chinese port stockpiles fell 1.3 million tonnes last week to 68.8 million tonsne)." 

The Imarex report is consistent with a Macquarie report, which said smaller Chinese steel mills were buying iron ore on the spot market. 

“The fall in spot raw material prices has been faster than the fall in steel prices recently, and the enhanced margin has induced some smaller mills to reopen," Macquarie said. 

The Macquarie report added that smaller Chinese steel mills were not obliged to pay contracted prices like their larger peers, so can use the spot market to buy inputs and produce steel profitably. 

Dow Jones Newswires


----------



## alexanderpatrick

Was wondering if anyone knows a good web site for tracking the Iron ore spot price.
Many thanks


----------



## noirua

I notice iron ore from Canada, bound for China, has been delayed pending the outcome of the Canadian ship, Nathalina, that was taken by pirates.

If you have a moment could you please pop over to compareshares as ASF (Aussie Stock Forums) needs your vote in the best forum contest:  http://www.thebull.com.au/the_stockies/forums.html


----------



## Miner

There is always some silver line which shows better when there is all cloud.
The price of shipping carriage has gone down 'ridiculously' low. The daily rates have become now weekly rate. I was talking with a shipping industrialist couple of days and he is worried about his company's future. He is not the only one however 

The good point is the price of seaborne materials will be cheaper making Chinese and Indian steel makers to get dirt cheap iron dirt : low freight cost, negotiated lower spot price from smaller suppliers.

The underlining meaning will be that Australian Iron Ore will loose the competitve advantage in terms of cost of sea borne materials against Brazil.

Are  BHP and RIO watching  the signal considering  they were too greedy to screw down the Chinese Steel makers to hike the iron ore price includng equalisation of freight cost ? 

Chinese Masters will probably take their revenge now


----------



## noirua

Hi Miner, I have checked the Gladstone Port, QLD and 17 ships are due December and have no cargo as yet. It looks as if customers have asked for delays.


----------



## J.B.Nimble

May be some glimmers of hope appearing. A few stories of late indicating that China's steel industry is starting to move again. A lot of reading between the lines required but as the inventory corrections move back through the supply chain we are finally starting to see some improvement at the dockside. Also been reading stories indicating shipping charter prices moving slightly north again - not really showing through on BDI yet but a recovery is built on many little steps such as these...



> IRON ore stockpiles at China's 19 major ports have fallen 15 percent from a record in November after steel makers and traders stopped buying expensive imports, according to an analyst at Umetal Research Center.





> Cash prices of iron ore imported by China rose 3.3 percent this month after gaining 13 percent in November, according to Beijing Antaike Information Development Co. Still, they are down 58 percent this year. China buys most of its spot iron ore from India.
> 
> Nanjing Iron & Steel United Co said steel prices have bottomed out and production would recover this month after four months of declines.
> 
> Steel makers in China's Tangshan restarted about 40 percent of their idled capacity last month. Tangshan is a city in China's northern province of Hebei, the nation's largest steel-making province with hundreds of small mills.



http://www.shanghaidaily.com/sp/article/2008/200812/20081225/article_385766.htm



> The Shanghai Securities News reported on Tuesday that several mills including Angang Steel Co, Beijing Shougang Co and the private-sector Shagang Group had raised prices for January. Angang raised prices for cold-rolled products by 230 yuan a ton, it said.




http://www.shanghaidaily.com/article/?id=385765&type=Business


----------



## chansw

*China turns screws on iron ore giants*
By Felicity Williams
The Daily Telegraph
January 02, 2009 03:46am

http://www.news.com.au/business/story/0,27753,24864541-462,00.html

JUST days into the new year the signs from China for our battered big miners are ominous. 

According to reports out of Shanghai, the Chinese Government is seeking tighter control over iron ore imports to help drive down prices for the steel-making ingredient. 

That's bad news for the world's biggest iron ore producers - Rio Tinto, BHP Billiton and Brazil's Vale - as it will give Chinese steel giant Baosteel much greater muscle in the current round of iron ore price talks. 

Substantially reduced iron ore prices will put even more pressure on BHP and Rio, as they grapple with dramatic price falls across all major commodities. 

Rio is especially vulnerable as it struggles with $US38.9 billion ($A55.3 billion) in debts in the face of the global financial crisis. 

Annual iron ore contract price negotiations are shrouded in mystery but are believed to have kicked off in the weeks before Christmas. 

Beijing reportedly wants closer monitoring of where iron ore shipments end up after their arrival in China's ports. 


And it is looking at clamping down on the practice among import agents of making profits by stockpiling iron ore as a punt on future higher prices. 

The new regulatory regime could hurt BHP and Rio as it will potentially reduce shipments of iron ore - Australia's second-biggest commodity export after coking coal - into China. 

Iron ore demand has already softened dramatically in recent months as the global economic slowdown pulls in steel-intensive industries such as construction activity and car-makers. Global construction of crude steel experienced one of its biggest reversals in November, tumbling nearly 20 per cent to just 59 million tonnes when compared with the same month of the previous year. 

In another bad omen China's first batch of coking coal imports for 2009 are nearly half the levels they were a year ago. China's Ministry of Commerce has decided on an initial quota of 5.78 million tonnes - down from 9.62 million tonnes at the start of last year. 

That suggests Australia's biggest trading partner is shifting to greater use of domestically produced coking coal rather than imported product as economic times get tougher. 

And it could not come at a worse time for coal producers already starting to suffer after a sharp drop in prices for the energy source. 

Queensland's Macarthur Coal last month slashed its profit guidance, suspended dividends and laid off workers after chairman Keith de Lacy warned shareholders that it was impossible to predict when coal prices would improve.


----------



## MR.

chansw said:


> Rio is especially vulnerable as it struggles with $US38.9 billion ($A55.3 billion) in debts in the face of the global financial crisis.




Rio's share price is down to 24% of its yearly high but BHP is down to 55% of its high. Why?

Rio has 55 billion in Debts! The market cap is currently 17 billion.  Their assets at a quick glance:
-(2006) 27 billion assets and owed 9 billion.  
-(2007) 79 billion assets and owed 55 billion. 
http://www.riotinto.com/documents/ReportsPublications/2007_Summary_financial_statements.pdf

2007 was a very big year......  crazy!!!!!   During the heat of the market!
How the hell do these directors let these companies get into so much debt?

Of the 79 billion in assets, 45 billion was property / plant / machinery. Goodwill was 15 billion. Both valued at 2007 prices (boom time) 
What price do you put on it now?     Oh dear!    not $38.06 ? ummm

----------------------

Got side tracked.
Wanted to post some iron ore companies and their price as a percentage of their yearly highs.
Did the calc's so why not post.

Admiralty trading is at 7% of its high (high $0.35) (Friday $0.025)
Atlas is at 27% of its yearly high
Australiasian is 20%
BC Iron 17%
Brockman 27%
Fortescue 13%
Gindalbie 27%
Grange 16%
Iron ore 19%
Mt Gibson 10%
Murchison 10%
Sphere 9%
Strike 11%
Sundance 19%
territory 10%
Western Plains 12%

Andrew Forest's Fortescue is what?.. just 13% of its high!  Remember the hype behind Fortescue and our richest man!
Alot of hurting above....  
So many would have caught the knife on the way down as well.... 
Very hard not to!


----------



## adobee

I dont think that is correct ???? FMG 13% of high..
they did a 10 for 1 share split ast around $100 -130+ bringing it down to $13 and is now around $2  ???   ummm correct me if I am wrong ..






MR. said:


> Rio's share price is down to 24% of its yearly high but BHP is down to 55% of its high. Why?
> 
> Rio has 55 billion in Debts! The market cap is currently 17 billion.  Their assets at a quick glance:
> -(2006) 27 billion assets and owed 9 billion.
> -(2007) 79 billion assets and owed 55 billion.
> http://www.riotinto.com/documents/ReportsPublications/2007_Summary_financial_statements.pdf
> 
> 2007 was a very big year......  crazy!!!!!   During the heat of the market!
> How the hell do these directors let these companies get into so much debt?
> 
> Of the 79 billion in assets, 45 billion was property / plant / machinery. Goodwill was 15 billion. Both valued at 2007 prices (boom time)
> What price do you put on it now?     Oh dear!    not $38.06 ? ummm
> 
> ----------------------
> 
> Got side tracked.
> Wanted to post some iron ore companies and their price as a percentage of their yearly highs.
> Did the calc's so why not post.
> 
> Admiralty trading is at 7% of its high (high $0.35) (Friday $0.025)
> Atlas is at 27% of its yearly high
> Australiasian is 20%
> BC Iron 17%
> Brockman 27%
> Fortescue 13%
> Gindalbie 27%
> Grange 16%
> Iron ore 19%
> Mt Gibson 10%
> Murchison 10%
> Sphere 9%
> Strike 11%
> Sundance 19%
> territory 10%
> Western Plains 12%
> 
> Andrew Forest's Fortescue is what?.. just 13% of its high!  Remember the hype behind Fortescue and our richest man!
> Alot of hurting above....
> So many would have caught the knife on the way down as well....
> Very hard not to!


----------



## MR.

adobee said:


> I dont think that is correct ???? FMG 13% of high..
> they did a 10 for 1 share split ast around $100 -130+ bringing it down to $13 and is now around $2  ???   ummm correct me if I am wrong ..




Don't "your" figures add up similar to mine?  What are you getting at?  Before the split lets say it was your $130- and Friday it was $1.745 you can't say FMG is down to just 1.3% of its high!.....  That would be a little silly!
Hope you're not just tring to be smart here!

Perhaps you are thinking "FMG is 13% off its high" but I wrote it is 13% of its high!  

Don't know what point you are attempting to make?


----------



## adobee

MR. said:


> Don't "your" figures add up similar to mine?  What are you getting at?  Before the split lets say it was your $130- and Friday it was $1.745 you can't say FMG is down to just 1.3% of its high!.....  That would be a little silly!
> Hope you're not just tring to be smart here!
> 
> Perhaps you are thinking "FMG is 13% off its high" but I wrote it is 13% of its high!
> 
> Don't know what point you are attempting to make?




My mistake you did clearly say 'of' its high and i took it as 'off' its high...
my sincere appologies..


----------



## adobee

What is the expectations of the new benchmark price ??
Considering a large drop in the price is this already factored into the market ? How bad does the market expect the price drop to be ?

Peoples thoughts please... thanks


----------



## challenger123

In the coming months there must be a rebound or floor for iron ore and  non ferrous metals in the world market.

The fiscal stimulus in the Chinese economy is already starting to take shape with large contracts being won by international companies to provide infrustructure.  

$1b Trains contracts! Buildings etc!! Record Lending in China will lead to increased demand for Australian Minerals!!! Please read article below!


BOC: Lending is determined by market(China Daily)
Updated: 2009-03-17 07:58 Comments(3) PrintMailDomestic banks are guided by market conditions and prudence - and not government diktat - when issuing new loans, the chairman of Bank of China has asserted.

No political leader has told his bank to lend as part of the central government's stimulus package to cope with the economic crisis, Xiao Gang told China Daily.

The situation is the same with other commercial banks and has been so for many years, he said.

Related readings:
 Wen: More stimulus push if needed New lending may exceed 5 trillion yuan in 2009
 China's stimulus package plan not fully understood
 Stimulus plan draws concerns over corruption
 Top legislature to improve supervision over stimulus plan



Chinese banks are expected to grant some 5 trillion yuan ($732 billion) in new loans this year, Premier Wen Jiabao told the annual session of the top legislature in Beijing last week.

Last year, new yuan loans amounted to 4.9 trillion yuan.

But banks are increasing their lending portfolio not because they are told to do so by the government, but because government-approved development projects are potentially the most lucrative, Xiao said.

Contrary to speculation that political pressure is behind the dramatic rise in drastic lending growth (1.62 trillion yuan of new loans in January alone, up 101 percent year on year), "the pressure is only from the market - in the form of competition from other banks and the expectations of ever-improving performance from our shareholders," said the boss of one of the four largest State-owned banking corporations in China.

Since the restructuring of the banking industry in 2003-04, many State-owned banks have become publicly-listed companies.

Right now, the lenders' game is to get a larger share of Beijing's 4-trillion yuan ($586 billion) economic stimulus package because they have little to worry about its implementation process, Xiao said. Most of the new loans issued in recent months have gone to the infrastructure projects in the stimulus package, he added.


Low interest rates are also a factor driving the banks to compete for more profitable lending projects, Xiao said. The central bank slashed lending and deposit rates by 1.08 percentage points in November, the largest reduction in more than a decade.

So whenever a good project is identified, "we have to try to lend early and lend a lot," Xiao said,

Xiao admitted that such rapid lending growth could lead to an increase in non-performing loans. "There is a possibility. That's also why we always have to be careful."

But Chinese banks are better equipped to handle bad loans than they were five years ago, thanks to stricter banking regulations, he said.

Xiao also said BOC is working on overseas expansion although it will remain "very cautious" with mergers and acquisitions.

BOC has more than 800 branches or outlets in 29 countries and regions; and this year marks the 80th anniversary of its first overseas branch in London.

Overseas, "BOC will concentrate on supporting Chinese companies' expansion," Xiao said. But since it takes a long time to set up branches abroad, BOC will seek to tie up with foreign financial institutions in those countries.

According to the company's statement, BOC has provided $26.9 billion in loans and services to more than 80 Chinese companies, including Sinopec, China National Petroleum Corp and China Mobile, in more than 60 countries.


Which means prices of minerals is expected to rise soon! They wont reach the hefty prices of 2008, but expect them to reach 2007 prices! With Australian Dollar hovering around 63-68c/US then this means quite a reasonable revenue going into 2H2009!
Bluechip Materials as well as a few quality speccies are the GO for Q2 2009! Good Luck!


----------



## Boris2868

123happy said:


> I'm also interested in small iron ore miners, as friend of mine is seeking to buy iron ore for a Chinese steel mill.
> 
> CFE, RHI, SDL and TRF are some of the junior iron ore players on my screen




I believe that I can connect you with a supplier of iron ore for your friend.

Please let me know if you need my assistance.


----------



## surfingman

Price talks for iron ore riddled with mistrust
John Garnaut in Qingdao,China
April 28, 2009

A CHINESE benchmark price for iron ore may not be set at all this year because Chinese mills cannot be trusted to honour their contracts, say mining executives involved in negotiations.

All three large Australian iron ore mining companies are reluctant to agree to any benchmark contract deal, regardless of the price, because of concerns the contracts will not hold if spot prices fall further, according to sources close to each company.

"If we set the benchmark at the spot price and the spot price goes higher, then they honour the contract and we lose," said an Australian executive involved in price negotiations. "And if the spot price keeps falling, then they ignore the contract and we still lose," he said.

An executive at another Australian iron ore major said "they effectively get a call option".

Negotiations have been sporadic this year, despite the new contracts being supposed to begin from April 1.

Since early March there have been virtually no ore shipments to China at the current benchmark price because Chinese buyers have walked away from their contracts in order to buy at or close to the domestic spot price, about two-thirds of the benchmark price, according to Australian miners and Chinese buyers.

Chinese mills say a precedent for abandoning contracts was set by Rio Tinto and Vale last year - the former shifted a proportion of iron ore exports from contract to spot sales and the latter tried and failed to achieve a mid-contract price rise.

While Australian miners have recently lost money from lower prices, they see benefits in shifting to a spot market or "index" price because it is calculated on a landed basis and therefore removes the freight subsidy that was previously given to Brazilian producers.

Brazil's Vale prefers the benchmark price system, for the same reason, but has said it will not set the benchmark price this year because Australian miners could ignore it, as they did last year.

The big entry this year into the Chinese spot market by the global miners has also given them an unprecedented reach into the smaller and mid-sized mills and trading companies that previously relied on ore mined in China.

Traders and shipping agents expect the iron ore spot price to keep falling as China is inundated by shipments the rest of the world no longer needs.

Huangdao Port is occupied by vast mountains of Australian and Brazilian iron ore that has been bought by Chinese mills and traders and is waiting to be carted to mills inland.

Port authorities are struggling to cope. "There are eight ships waiting at Huangdao now, 11 down at Rizhao, because we are running at capacity and can't unload," said Zhang Zaichun, general manager of the Qingdao Port Authority, which controls Huangdao and nearby Rizhao, two of the world's largest iron ore ports.

Huangdao handles 82 million tonnes of iron ore a year and Rizhao slightly more. But port authorities are nevertheless building a third huge iron ore port in between, to handle 400,000 tonne vessels from Brazil.

"The volume has slowed down because of the port stockpiles. Everybody fears prices will go down and down," said Li Long, a Sinosteel representative in Qingdao.


Full Story Here


----------



## happytown

rio tinto has announced a 2009 iron ore price settlement with japanese steel co nippon

the hammersley contract price settlement has in the past become the default annual contract price

awaiting chinese and bhp and vale response



> ...
> 
> Under this agreement, the new prices for Hamersley products will be:
> 
> Pilbara Blend Fines US cents 97 per dry metric tonne unit (*approx 32% down from last year*)
> 
> Yandicoogina Fines US cents 97 per dry metric tonne unit (*approx 32% down from last year*)
> 
> Pilbara Blend Lump US cents 112 per dry metric tonne unit (*approx 44% down from last year*)
> 
> ...



cheers


----------



## LeeTV

*July China iron ore imports at highest monthly volume on record*
http://www.bloomberg.com/apps/news?pid=20601012&sid=aJwN01TEImHg

Chinese steel demand appears to be making a solid recovery with iron ore imports at a new record. Steel exports are rising but still well below a year ago.

Posted:  Tuesday , 11 Aug 2009 

BEIJING (Reuters) -  


China imported 58.08 million tonnes of iron ore in July, the highest monthly volume on record and up 31.8% from the same period last year, the country's customs authority said on Tuesday.

Steel product exports reached 1.81 million tonnes, 25% higher than June but down 67.3% compared with July last year.

In June, iron ore imports were 55.3 million tonnes and exports of steel products were at 1.43 million tonnes. Analysts said Chinese steel demand was making a solid recovery, and an increase in domestic ore output has not been enough to meet the needs of the market.

"Total demand has increased and China has got to import to fill the incremental demand growth," said Henry Liu of Macquarie Bank in Shanghai.

But despite signs that overseas markets are also improving, the China Iron and Steel Association still insists imports are far higher than necessary.

Irrational expansion plans by small local mills and speculative behaviour by traders had boosted the import volume to unrealistic levels and pushed spot ore prices beyond what the market can bear, CISA Secretary-General Shan Shanghua said at an association meeting in Beijing last month.

CISA has attempted to cajole traders and small mills into cutting iron ore imports, in a bid to bolster its position during protracted contract price talks with foreign miners Rio Tinto (RIO.AX: Quote)(RIO.L: Quote), BHP Billiton (BHP.AX: Quote) and Vale (VALE5.SA: Quote).

CISA figures show trading companies were responsible for 44% of all iron ore imports in the first half of 2009, up from 30% last year.

CISA is urging the government to revoke import licences in order to better control the volumes of overseas iron ore coming into the country.

(Reporting by David Stanway, Editing by Clarence Fernandez and Jacqueline Wong)

 © Thomson Reuters 2009. All rights reserved.


----------



## MR.

http://www.thebull.com.au/articles_detail.php?id=10568


> The China Iron and Steel Association has asked domestic steel firms and traders not to import iron ore from Rio Tinto, BHP Billiton and Brazil's Vale for two months




Are we really surprised?


----------



## Joules MM1

*The Iron Ore Futures Collapse Chart That Everyone Is Talking About It*




Joe Weisenthal|Aug. 22, 2012, 8:39 AM


Read more: http://www.businessinsider.com/iron-ore-futures-2012-8#ixzz24HZjiUDQ

excerpt 







> Included with the chart he sent this nice, quick overview:
> 
> Iron ore is second biggest commodity traded internationally by volume (after oil). It is the main ingredient in the production of steel. China is by far the worlds #1 producer of steel and importer of iron ore (over 60% of seaborne ore goes to China).
> 
> While Wall Street focuses on Oil, Natural Gas, Copper etc., Iron ore is a huge commodity that is highly reliant on Chinese demand.    While most other commodities are recovering from their lows Iron Ore is crashing.    The spot peaked this year at around $150/ton in April   (highs close to 190 last year). The spot now is around $105 per ton and falling fast and the futures (now fairly liquid and traded internationally) are pricing q4 below $95/ton.


----------



## sinner

Good stuff.

John Hempton from Bronte Capital recently wrote a post discussing how marginal producers would not be able to withstand lower prices in ore for very long but that companies like BHP and RIO are making serious bread at almost any iron ore price.


----------



## DB008

There was a good article in the AFR this weekend regarding FMG.

FMG needs the price of iron ore to be around at '$100 per ton' mark to fund it's mines and service debt levels, but only for he next 12 months or so. l'm sure they will manage, but it will still be interesting to see how they go if...


----------



## Smurf1976

I've been interviewing people for a permanent position (trades) recently. 

Suffice to say that I've encountered more than one who has been put off by contractors working for BHP or Rio at iron ore mines in WA as a cost cutting measure.

That says it all really. The big miners are now actively looking to cut costs rather than aiming to maximise production.


----------



## DB008

Fortescue unhappy with iron ore price



> Fortescue Metals insists the plummeting iron ore price will rebound but admits it is disappointed by the rapid decline.
> 
> *Iron ore spot prices have dropped by 50 per cent from the record levels of about $US180 ($A174.70) a tonne in the first half of calendar 2011, and have fallen by 30 per cent over the past two months.
> 
> Spot iron ore prices fell $US4.50 to near three-year lows of $US90.30 ($A87.64) on Wednesday, with reports of more falls on Thursday in China.*
> 
> Iron ore is Australia's biggest export earner.
> 
> Major miners BHP Billiton and Rio Tinto, along with Fortescue, are dependent on continued Chinese demand to earn returns on the billions of dollars they have committed to expanding iron ore production in the Pilbara region of Western Australia.
> http://news.brisbanetimes.com.au/breaking-news-business/fortescue-unhappy-with-iron-ore-price-20120830-2530b.html




Never seen this site, but the chart looked handy.....



> CHART OF THE DAY: The Great Iron Ore Crash Of 2012
> 
> Iron ore futures collapsed today, falling 6.7 percent. It's a major component of steel and as such is viewed as one indicator of economic health in China.
> 
> As you can see from the charts below, it's been getting crushed for a while. It's at its lowest levels since 2009.
> However, JPMorgan analyst Alessandro Abate thinks iron ore is poised for a turnaround. In a note to clients this morning, he writes:
> 
> Iron ore spot price: catalysts heading towards a reversal of spot price trend in September. Reasons: 1) recent iron ore spot price decline ($40/t in July/Aug), due to traders’ destocking on high inventory level and lagged recovery of Chinese steel demand; 2) current spot price implies a further reduction of Chinese domestic iron ore output (July at 115mt -8% m/m) going forward, in our view with 3) little sense for traders’ ‘selling frenzy’ at current iron ore spot price; as 4) cut of domestic Chinese steel output (705-710mt Aug annualized, with likely further downside going forward) likely to hit domestic miners and benefit iron ore seaborne traders (shift of demand away from expensive domestic miners’ output).
> 
> Shares of Rio Tinto, a major Australian exporter, fell 3.1 percent in London trading today.
> 
> Here's the monthly chart:
> 
> 
> 
> 
> http://www.businessinsider.com/chart-of-the-day-iron-ore-is-getting-destroyed-2012-8





*Question - Will Gina continue with her Roy Hill project?*


----------



## DB008

Miners forced to take discounted prices for iron ore



> The sharp decline in iron ore prices, and a clouded outlook for the metal, has prompted China to clamp down on excess capacity and begin demanding that Australian iron ore exporters sell their product at discounted rates, according to The Australian Financial Review.
> The Chinese government has ordered all steel mills in the country producing less than one million tonnes annually to close in an effort to shut unprofitable capacity.
> The prospect of declining Chinese demand has hit Australian miners hard, as they have become increasingly reliant on Chinese state-owned traders to sell stock at a time when the miners are struggling to find buyers for their inventory. The AFR reported that Rio Tinto now sends nearly a third of its iron ore through Sinosteel to stockpiles in China.
> “BHP right now is offering cargoes on the spot market but no one will meet their price expectations so mills are going about $US5 below what BHP can offer,” an executive in the raw material import department of a top five Chinese steel mill reportedly told the AFR.






> “Rio Tinto right now don't have long-term contracts for buying 30 per cent of their shipments on a regular basis. They are offering cargoes at spot prices to traders just to move the iron ore. Sinosteel is stopping steel mills from bidding, they prefer to buy it from the stockpiles in China."




http://www.businessspectator.com.au/bs.nsf/Article/Miners-forced-to-take-discounted-prices-for-iron-o-pd20120905-XUPQM?opendocument&src=rss


----------



## Joules MM1

*The Aussie Debacle Is Signaling A Chinese Hard Landing, As The Iron Ore Market Melts*



Anchalee Worrachate, Monami Yui, Bloomberg


Read more: http://www.businessinsider.com/the-...g-a-chinese-hard-landing-2012-9#ixzz27OM4hPiO

Sep. 23, 2012, 7:28 PM

excerpts:



> Investors are showing concern that Australia’s economy may slow after the price of iron ore, which made up more than 20 percent of exports last year, dropped as much as 37 percent this year to the lowest level since October 2009.
> 
> Fortescue Metals Group Ltd., Australia’s third-biggest producer, cut its spending plans by 26 percent as iron-ore prices declined.
> 
> BHP Billiton Ltd, the world’s largest miner, delayed work at the Olympic Dam copper-uranium-gold project in South Australia last month, joining companies including Xstrata Plc and Rio Tinto Group in scaling back expansion.






> China’s net exports and investment have “reached their limits,” Ramin Toloui, Pimco’s co-head of emerging markets portfolio management in Singapore, said in a Sept. 13 e-mail.
> 
> Australia’s economy grew 0.6 percent in the second quarter from the prior three months, according to a Bureau of Statistics report on Sept. 5, slower than the median estimate of economists for a 0.7 percent gain. Home-loan approvals unexpectedly fell in July by the most in five months.


----------



## Joules MM1

http://www.bloomberg.com/news/2012-...gest-bear-market-in-20-years-commodities.html


*Iron Ore Heads for Longest Bear Market in 20 Years: Commodities*

 By Bloomberg News - Oct 3, 2012 4:27 PM GMT+1000

excerpt



> Iron ore’s turnaround is luring some of the world’s most high-profile short sellers, including Jim Chanos, who oversees about $6 billion as the founder and president at Kynikos Associates Ltd. He’s targeted producer Fortescue Metals Group Ltd. (FMG), which at one point made Andrew Forrest Australia’s richest man as iron ore rose more than sixfold from 2001 to 2008 on Chinese demand.
> 
> Forrest’s net worth has plunged by 14 percent this year to $3.9 billion, according to data compiled by Bloomberg. More than 97 percent of his wealth is linked to shares of Fortescue. Gina Rinehart, who became Asia’s richest woman after her father discovered minerals that helped create Australia’s iron ore industry, has seen her wealth plunge $1.2 billion, or 5.7 percent, this year to $19 billion, the data show.


----------



## VeryGreen

Joules MM1 said:


> http://www.bloomberg.com/news/2012-...gest-bear-market-in-20-years-commodities.html
> 
> 
> *Iron Ore Heads for Longest Bear Market in 20 Years: Commodities*
> 
> By Bloomberg News - Oct 3, 2012 4:27 PM GMT+1000
> 
> excerpt




Thanks for the post Joules!
I read it last friday but popped back in to see if anyone had made any comments today. Some hard times ahead for iron ore perhaps? I know FMG are trying to get all their good stuff which has a 1:1 strip ratio (wastere) but I was looking around and seen Karara calculate a 0.34:1 strip ratio... They have good ore too. As an ex FMG employee I do hope that they stick around for a long while yet. They are doing some good things and they are employing a lot of good people. They just dont appear to be in as good a position as the other iron ore miners.

As a newbie, and someone who has made a tidy living out of iron ore I am interested to hear peoples opinions on where they speculate iron is going.


----------



## doctorj

Interesting - BHP has been buying a little iron ore in the spot markets...



> SINGAPORE, Jan 17 (Reuters) - BHP Billiton (NYSE: BBL - news) , the world's No. 3 iron ore miner, bought 100,000 tonnes of the raw material on the spot market in a rare move that traders interpreted as a strategy by producers themselves to stem a decline in prices as Chinese demand thins.




http://uk.finance.yahoo.com/news/1-bhp-buys-iron-ore-095147855.html


----------



## Uncle Festivus

Funny games going on for sure? Not sure how the record shipments of iron ore tally with the global steel glut?

Governments around the world are still building and subsidising steel making facilities in order to provide employment for the voting masses. China has realised that it can't keep subsidising loss making mills while India has only just realised this as well.

I think the latest rise in the IO price is an over-reaction to China's latest 'easing' policies and the general perception that they have avoided the dreaded 'hard' landing, but eventually the price will reflect intrinsic global demand. Or at least till governments run out of (subsidising and or stimulation) money?


----------



## Aussiejeff

Uncle Festivus said:


> Funny games going on for sure? Not sure how the record shipments of iron ore tally with the global steel glut?
> 
> Governments around the world are still building and subsidising steel making facilities in order to provide employment for the voting masses. China has realised that it can't keep subsidising loss making mills while India has only just realised this as well.
> 
> I think *the latest rise in the IO price is an over-reaction to China's latest 'easing' policies* and the general perception that they have avoided the dreaded 'hard' landing, but eventually the price will reflect intrinsic global demand. Or at least till governments run out of (subsidising and or stimulation) money?




Per the previous post about BHP buying back it's own previously exported iron ore (presumably to artificially prop up prices that would decline further, hurting future plans?) - maybe this is the beginning of the end of Australia's mining boom? But not China's - I suspect they have many new, cheaper markets in mind to target. They will squeeze Oz for all she is worth.


----------



## VeryGreen

Hi guys,

This arrived i my inbox today. Thought I would share.



> The iron ore price may slump 54 per cent to around $US70 a tonne due to a big lift in supply from mining companies, according to UBS analysts.
> http://www.miningaustralia.com.au/n...- send -> 27/02/2013 12:57:00 PM&utm_content=




Sorry for the long URL


----------



## burglar

Do we expect the slump to be over any time soon?


----------



## pixel

burglar said:


> Do we expect the slump to be over any time soon?




Looks like it: http://www.macrobusiness.com.au/2013/10/daily-iron-ore-price-update-breakout-3/#


----------



## burglar

pixel said:


> Looks like it: ...




Thanks pixel,


----------



## skc

Probably the wrong thread to post this, but it's a really interesting article on the cost of capital projects in Australia.



> CITIC Pacific’s Sino Iron project produced its much-awaited first shipment of iron ore concentrate in December last year, $US6 billion over budget and four years behind schedule.






> CITIC and its principal contractor, the Metallurgical Corporation of China (MCC), severely underestimated the cost of construction in Australia. The budget soared from $US1.75 billion in June 2007 to $US4.3 billion at the end of December 2011.
> 
> “We don’t understand the actual conditions of building large mining projects in Australia. We tried to apply our lessons learnt in China locally and severely underestimated the difficulty of the project. As a result, we went on a detour,” Chang told the People’s Daily.






> At the peak of construction, CITIC employed 4,000 construction workers and Chinese workers accounted for less than 5 per cent of the total workforce. Chang was further shocked by high wages in Western Australia.  He told bewildered Chinese reporters that a truck driver in WA earned $150,000 on average, or about 800,000 yuan (17 times China’s average urban salary).
> 
> Business Spectator understands CITIC Resources’ top man in Australia earns roughly the same salary as the truck driver that he employs.




http://www.businessspectator.com.au/article/2014/1/9/china/chinas-shock-and-ore-australian-way

Yes there are lots of poor planning and lack of local knowledge on display here, but it also highlights how uncompetitive Australia is for global investments from a cost perspective.


----------



## IFocus

skc said:


> Yes there are lots of poor planning and lack of local knowledge on display here, but it also highlights how uncompetitive Australia is for global investments from a cost perspective.




Have friends who worked on the project, the Chinese took a heap of short cuts causing a lot of re-work here in Oz.

Still the over run is staggering.


----------



## notting

Lots of brokers calling FMG RIO and the like buys.
Technicals all seem to be failing.
Desperation as they get spanked for the moment it seems.
China IO imports up 10.2% on year but *down 5.7% for December* and the surplus shrunk and *was below expectations* for the month.  Tell *The Bull* to add that to their article.


----------



## notting

notting said:


> Lots of brokers calling FMG RIO and the like buys.
> Technicals all seem to be failing.
> Desperation as they get spanked for the moment it seems.
> China IO imports up 10.2% on year but *down 5.7% for December* and the surplus shrunk and *was below expectations* for the month.  Tell *The Bull* to add that to their article.




The last time I wrote in here. The Bull was bulling IO for January, which I am sure made for some most unpleasant experiences for some.

Here is what has happened since then *6 months* - 




Now there appears to be a bit of a bottom forming. Here is some relative picks *2 years* -


----------



## burglar

notting said:


> The last time I wrote in here. The Bull was bulling IO for January, which I am sure made for some most unpleasant experiences for some ...




Flinders Mines FMS


----------



## notting

burglar said:


> Flinders Mines FMS




They haven't even started producing have they?


----------



## burglar

notting said:


> They haven't even started producing have they?




Correct.
But the drill results are good!
And their address is excellent!!


----------



## notting

AUS Export value for May - Iron ore $6737m (+5%mom), Coal $3074m (-1.8%), Nat Gas $1307m (-8.9%), Petro oil $845m (-3.5%), wheat $665 (+28%)


----------



## notting

Port Hedland June exports - Iron ore volumes 33.6 Metric tons (down 6.8% from May or 2.5 million tons)
Is June traditionally less?  Given IO stocks had a pretty good couple of weeks in terms of price appreciation.


----------



## burglar

Some-one asked me yesterday, why do I invest in Iron Ore whilst it's price is falling.

My reply; I am invested in a company, not the commodity!
And as notting says, they are not producing.


----------



## Value Collector

burglar said:


> Some-one asked me yesterday, why do I invest in Iron Ore whilst it's price is falling.
> 
> My reply; I am invested in a company, not the commodity!
> 
> 
> ]




That's right, as long as they are producing at a sufficiently low cost, and you made your purchase at a valuation the reflects the low margins you will still do well. These down turns in the commodity price don't really matter, in fact over time they can have a significantly positive impact for the low cost producers, BHP, RIO and FMG are all driving down their costs even further, while some of their competitors are leaving the market, So when the price stabilizes, they will have a larger market share, and a lower cost base.

When it comes to development projects though, it is a dangerous position, it the fear of the fall funding may dry up, and even if they make it to production, its hard to know what their production cost will be. Usually new production is a higher cost for the first couple of years.


----------



## rimtas

I usually don"t buy stocks that cost less than a dollar, or even better-less than 10...These kind of companies are in the market only to attract money through IPO and further securities down the road.


----------



## ROE

rimtas said:


> I usually don"t buy stocks that cost less than a dollar, or even better-less than 10...These kind of companies are in the market only to attract money through IPO and further securities down the road.




huh? What the? stock price got nothing to do with the business dilution or want to tap you for cash, it is all about earning and market caps

DMZ at some point sold for $2.20
RFG at some point sold for 60c 
NVT at some point sold for $1.98
CBA float at $5.50
CCP float at 50c
TGA 20-40c you can get them for when they starting out
GXL Float at a buck or two
FLT,SEK,CRZ,WOW, VED

all kick ass performer all sold for less than $5 a pop at float or through their life cycle

if you got all those suckers you are mega rich, they all out perform the market by a factor of several hundred percent


----------



## Value Collector

rimtas said:


> I usually don"t buy stocks that cost less than a dollar, or even better-less than 10...These kind of companies are in the market only to attract money through IPO and further securities down the road.




What school of finance did you study Rim?

as already pointed out the share price means nothing when it comes to dilution, plenty of great companies are currently under $10.

whether a company had a par value of $1, $10 or $100 gives you no information about the prospects of future dilution or value.

whether they issued 1,000,000 x $1 shares or 10,000 x $100 shares it doesn't really matter, the company still has a capitalisation of $1,000,000


----------



## burglar

Value Collector said:


> ... whether a company had a par value of $1, $10 or $100 gives you no information ...




Methinks rimtas has a psychological fear of penny-dreads.
I pay the roughly the same for my penny-dread parcels as I did for my NAB parcel.

I like $3000 parcels best! 

Smaller means I work for the broker. 
Larger means I risk too much Seed Capital!


----------



## pixel

ROE said:


> huh? What the? stock price got nothing to do with the business dilution or want to tap you for cash, it is all about earning and market caps




in-bl***y-deed, ROE

and you forgot a few that I remember:
bought RIO at one stage at $5.85
WAN in the IPO @ $1
FMG started out at a few cents; they even *split* 10-for-1 because Twiggy thought $100 would scare investors off.

In other sectors, ANZ was $2.95 in the early 1990's; 
and look at my current favourite, LNG! Had I waited for it to become a $1+ stock, I'd be up 200 or 250%. Buying at 35c means 1,000%. 

But each to his own. Actually, I prefer sub-$1, even penny stocks because of their higher ATR%. Admittedly and unashamedly, I'm first and foremost a trader, earning a wage from swing profits.


----------



## burglar

pixel said:


> ... bought RIO at one stage at $5.85
> WAN in the IPO @ $1
> FMG started out at a few cents;   ...




Some of these are in Iron Ore!


----------



## pixel

burglar said:


> ...psychological fear of penny-dreads.




Many people seem to harbour that fear. That's probably why they're called penny *dread*ful 



> I pay the roughly the same for my penny-dread parcels as I did for my NAB parcel.
> 
> I like $3000 parcels best!
> 
> Smaller means I work for the broker.
> Larger means I risk too much Seed Capital!




Apart from the parcel size, I follow the same strategy.
On average, my parcels may be a little bigger, even though OM's minimum brokerage is only $13.95. Brokerage is an overhead; without it, I can't make a quid at all.
But I vary the size depending on my specific risk assessment. If a trend runs my way, I'm quite happy to double up or add smaller amounts several times; OM lets me take a dozen bites a day and still sends me only one contract note with one minimum brokerage.


----------



## Profiteer

Mildly off topic, are there any iron ore producers in the ASX 300 besides RIO, BHP, FMG, AGO, MGX & BCI?

Thanks


----------



## skc

Profiteer said:


> Mildly off topic, are there any iron ore producers in the ASX 300 besides RIO, BHP, FMG, AGO, MGX & BCI?
> 
> Thanks




ARI, MIN.

I don't know if the following are still in the ASX300

GRR, IOH, GBG.


----------



## burglar

Profiteer said:


> Mildly off topic, are there any iron ore producers in the ASX 300 besides RIO, BHP, FMG, AGO, MGX & BCI?
> 
> Thanks




Is GBG GINDALBIE METALS LTD producing?
FMS FLINDERS MINES LIMITED is definitely not yet producing!


----------



## systematic

The only one I can add to the lists above is Sundance (SDL) - the rest covers my list.

GRR got knocked out of the 300, IOH and GBG not in there.  MIN I have as a mining services company.


----------



## skc

burglar said:


> Is GBG GINDALBIE METALS LTD producing?




Definitely producing. See activities report last quarter 31/7/2014



systematic said:


> The only one I can add to the lists above is Sundance (SDL) - the rest covers my list.
> 
> GRR got knocked out of the 300, IOH and GBG not in there.  MIN I have as a mining services company.




SDL is not producing anything.

MIN has a large services division but also produces iron ore under Polaris Metals Pty Ltd. Last year 10.4m wmt was exported. So they only produce slightly less than AGO (12mtpa).


----------



## Profiteer

skc said:


> ARI, MIN.




Hmmm....between them, who produced more iron ore in the 1st half of this year (or last year if data not available)?

Thanks


----------



## systematic

skc said:


> SDL is not producing anything.




I did not read the question carefully (Profiteer wanted producers, I was just looking at listed industry), my apologies.  Missed that with MIN, thanks.


----------



## systematic

Profiteer said:


> Hmmm....between them, who produced more iron ore in the 1st half of this year (or last year if data not available)?
> 
> Thanks




This year (first half):

ARI = 5.45m 

MIN = 5.54m


----------



## VSntchr

pixel said:


> OM lets me take a dozen bites a day and still sends me only one contract note with one minimum brokerage.




That's very nice to know Pixel...have been looking at something as an alternative for short term share trades, as opposed to CFD's...will look into OM better.


----------



## DeepState

Rio Tinto made a presentation today.  I am interested in critiques to their argument.  Here is the key data:

Demand for iron ore is going up, India etc developing demand, 80% of population... I don't have much problem with this, but can easily be swayed if you have a better viewpoint (which would not be hard).




Note how the Chinese volume expectation isn't particularly aggressive.

If this is the cost curve evolution, this argues for a sustained and pretty high price for iron ore and solid export value when it is all mixed in, even if some of the high cost miners run at losses but are maintained for strategic purposes etc.


----------



## skc

DeepState said:


> Rio Tinto made a presentation today.  I am interested in critiques to their argument.  Here is the key data:
> 
> Demand for iron ore is going up, India etc developing demand, 80% of population... I don't have much problem with this, but can easily be swayed if you have a better viewpoint (which would not be hard).
> 
> Note how the Chinese volume expectation isn't particularly aggressive.
> 
> If this is the cost curve evolution, this argues for a sustained and pretty high price for iron ore and solid export value when it is all mixed in, even if some of the high cost miners run at losses but are maintained for strategic purposes etc.




It is very interesting to watch this unfolds. It's long term strategic game theory at a grand scale. We all know the classic economics 101 textbook supply and demand curves in theory. But nobody actually knows what the next marginal 25Mtps capacity is going to do to the price of the commodity. 

I can see the Chinese doing their counter strategic thing... i.e. securing resources (probably mostly in Africa) and producing at marginal loss for strategic purposes as you say. RIO/BHP's expanding capacity may kill off smaller high cost players, it is not going to deter a State player. The Chineses are probably sending a Xmas thank you card to Andrew Mackenzie and Sam Walsh as we speak for all the cheap capacity.


----------



## McLovin

DeepState said:


> If this is the cost curve evolution, this argues for a sustained and pretty high price for iron ore and solid export value when it is all mixed in, even if some of the high cost miners run at losses but are maintained for strategic purposes etc.





Wasn't there going to be a supply response out of Africa? The cash costs were like ridiculous, in the order of $15/tonne. This was a couple of years ago that I read about it. And the reserves were supposed to be similar to the Pilbara.


----------



## qldfrog

skc said:


> I can see the Chinese doing their counter strategic thing... i.e. securing resources (probably mostly in Africa) and producing at marginal loss for strategic purposes as you say. RIO/BHP's expanding capacity may kill off smaller high cost players, it is not going to deter a State player. The Chineses are probably sending a Xmas thank you card to Andrew Mackenzie and Sam Walsh as we speak for all the cheap capacity.




Fully agree with this view.BHP/RIO are the dream team for the chinese and will end up sucked dry...sorry just realised the investors aka us and as a side effect the australian tax payers via reduced profits/dividends are subsidising the chinese manufacturers now, and on the long term as skc explains.Coal is in the same bandwagon.


----------



## notting

The real game.

BHP & RIO vs  Vale


Whilst you read this article you have to first open another tab and get - this going.

http://www.youtube.com/watch?v=hY-vXcmpZIw

Then go back to the other link in another tab and read -


http://www.smh.com.au/business/mining-and-resources/brazilian-miner-vale-to-expand-iron-ore-despite-low-price-20141031-11eorj.html

Vale is getten squeezed!


----------



## dlineinvestor

Hi, Does anyone have a link for tracking the iron ore spot price ? 
Charts etc ..


----------



## notting

dlineinvestor said:


> Hi, Does anyone have a link for tracking the iron ore spot price ?
> Charts etc ..




http://www.steelhome.cn/english/tksshpi/index_tks_bg.php


----------



## dlineinvestor

Thank you  "Notting"


----------



## nulla nulla

notting said:


> http://www.steelhome.cn/english/tksshpi/index_tks_bg.php




Thank you notting.


----------



## Wysiwyg

Just wondering whether it would be a good idea to buy and stockpile all this cheap iron ore and sell it on the market at higher prices in years to come. Is that dumber than over supplying a market and getting less return per unit.


----------



## Smurf1976

You mean buy some as an individual?

Or the mining companies stockpile millions of tonnes of it above ground?

With the actual mining costs in WA (most of the Australian production) so low, they could just leave it in the ground and effectively have a stockpile. 

Not so in Tas however, since the ore all goes through a factory (which has a limited capacity) and comes out as high grade pellets (worth more than just the ore "as is"). But that's only a fairly small operation, about 2.5 million tonnes a year. It's a locally significant employer etc but trivial in terms of iron ore production as such.

Not sure about the mines in SA.


----------



## Wysiwyg

Smurf1976 said:


> You mean buy some as an individual?



Just a thought but Roy Hill will likely ensure low i.o. prices prices down forever.


----------



## sydboy007

the below is from from macrobusiness.

will make for interestign times to see how much the various Govts will try to prop up uncompetitive miners.  If it's not good enough for the car manufacturers one has to wonder why it's good enough for the miners, especially when there's not a snowball's chance of prices rising high enough again to end the subsidies.

Lets just rip the bandaid off quickly and be done with the pain.



> The first scenario is the cartel structure favoured by various pollies that seeks to protect and include iron ore juniors by pulling back major miner supply expansions. The second is also a cartel but one that results from swift junior rationalisation enabling the major miners to consolidate their pricing power.
> 
> In the junior cartel, Australian iron ore produces 837 million tonnes (mt) of iron ore from 2016 onwards. It does so at a slightly improved price for 2016 as oversupply is reduced in the short term by 43 mt as majors retrench. However, as Sino, Roy Hill, Anglo and Vale continue their expansions and Chinese demand keeps falling, the glut builds from 2017 onwards and the price keeps falling. In due course, smaller members of junior cartel require enormous subsidy to stay afloat as they register huge losses year after year in a price environment stuck at $20 and below. It’s either that or the cartel must negotiate spectacularly implausible shared volume cuts across all Australian producers (at least those in the cartel). Trade rules must be junked, Chinese relations destroyed and the WTO as well as ACCC told to piss off. To operate this would require a virtual nationalisation of all players as total transparency governs quotas, otherwise widespread cheating is inevitable, as in OPEC.
> 
> In the alternative model, the major cartel, Australian iron produces 880mt in 2016. It does so at an average $10 lower than the junior cartel in that year given the higher supply glut. However, as the 50mt of junior and 165mt of Fortescue production shuts down by 2017 the iron ore price at first stabilises and then slowly rebounds as some pricing power returns to the major producer’s cartel. Iron ore volumes are down to 715mt but the price is trading at $40 per tonne in a rough market balance.
> 
> Juxtaposing these two scenarios gives you the following total revenue chart for the sector (and nation):


----------



## Value Collector

Well recent moves in the Iron ore price are interesting, back over $70 dollars / tonne today as reported by metal bulletin. 

it's an interesting game to watch, I tell you, value investing is the most interesting and rewarding job there is.


----------



## notting

Value Collector said:


> Well recent moves in the Iron ore price are interesting, back over $70 dollars / tonne today




Interesting is the word. Check the volume spike on SLX vector steel ETF on the 8th of Aug which was the same day that the Chinese called the beginning of the 'steel ice age.'

https://www.google.com/finance?cid=3254555


----------



## skc

notting said:


> Interesting is the word. Check the volume spike on SLX vector steel ETF on the 8th of Aug which was the same day that the Chinese called the beginning of the 'steel ice age.'
> 
> https://www.google.com/finance?cid=3254555




Definitely interesting. It's like every steel user all of of sudden got the wink and the nod from higher-up's to start building and use steel again. It's really bizarre how the capital investment tap is turned on again just like that...


----------



## notting

skc said:


> Definitely interesting. It's like every steel user all of of sudden got the wink and the nod from higher-up's to start building and use steel again. It's really bizarre how the capital investment tap is turned on again just like that...




Did the central bankers, after agreeing to end the currency war, agree to all tell their individual legislators that 'things are slowing, we have no amo left and you all must do something or we risk sliding into a deep deep hole without a ladder out. Just start building infrastructure, anything, get to it!'


----------



## skc

notting said:


> Did the central bankers, after agreeing to end the currency war, agree to all tell their individual legislators that 'things are slowing, we have no amo left and you all must do something or we risk sliding into a deep deep hole without a ladder out. Just start building infrastructure, anything, get to it!'




Who knows... or may be the crowd finally clicked that holding onto anything physical (i.e. commodities) is better than suffering negative rates?!

Today the iron ore plays are all quite weak despite strong I/O prices so a bit of divergence today.


----------



## CanOz

skc said:


> Who knows... or may be the crowd finally clicked that holding onto anything physical (i.e. commodities) is better than suffering negative rates?!
> 
> Today the iron ore plays are all quite weak despite strong I/O prices so a bit of divergence today.




On my phone at the moment but just watched an interesting bloomberg video on the increase in construction activity again in China, up 20% yoy. They're saying they're actually using steel again, as well zinc is up and copper to some degree as they stimulate the economy and sink further into debt....seems we have a mini commodity boom again which any USD weakness will exacerbate.


----------



## CanOz

If someone can post a link...there's also a speculative element to this bubble...


----------



## Joules MM1

CanOz said:


> If someone can post a link...there's also a speculative element to this bubble...




http://www.bloomberg.com/news/artic...ron-ore-s-going-back-to-35-as-surplus-returns goldman-says-iron-ore-s-going-back-to-35-as-surplus-returns

http://www.bloomberg.com/news/artic...-above-70-as-chinese-steel-mills-boost-demand iron-ore-surges-above-70-as-chinese-steel-mills-boost-demand

no extreme pessimism + a winter phase ?

smells like teen bounce, crowded trade longside

http://www.businessinsider.com.au/the-iron-ore-price-continues-to-climb-2016-2 the-iron-ore-price-continues-to-climb-2016-2 (feb 17th)
http://www.fool.com.au/2016/03/08/is-this-the-start-of-another-iron-ore-bull-market/ is-this-the-start-of-another-iron-ore-bull-market/ (march 8th)


----------



## CanOz

Joules MM1 said:


> http://www.bloomberg.com/news/artic...ron-ore-s-going-back-to-35-as-surplus-returns goldman-says-iron-ore-s-going-back-to-35-as-surplus-returns
> 
> http://www.bloomberg.com/news/artic...-above-70-as-chinese-steel-mills-boost-demand iron-ore-surges-above-70-as-chinese-steel-mills-boost-demand
> 
> no extreme pessimism + a winter phase ?
> 
> smells like teen bounce, crowded trade longside
> 
> http://www.businessinsider.com.au/the-iron-ore-price-continues-to-climb-2016-2 the-iron-ore-price-continues-to-climb-2016-2 (feb 17th)
> http://www.fool.com.au/2016/03/08/is-this-the-start-of-another-iron-ore-bull-market/ is-this-the-start-of-another-iron-ore-bull-market/ (march 8th)




Thanks mate....

i used to have an Iron ore index in my Premium Data, can't find it now...


----------



## CanOz

From the tweet deck....


----------



## CanOz

Rumor becomes fact....


----------



## CanOz

Well done! Limit up in the face of restrictions.


----------



## Younga

anyone with views where iron ore is headed....or is it just going to trade sideways?


----------



## SuperGlue

Younga said:


> anyone with views where iron ore is headed....or is it just going to trade sideways?




It was only about 2 months away from the bottom (looking at FMG, RIO & BHP charts) when you raised the question.

Now things are picking up on the employment side of the sector. So looking good now?

"*Mining jobs increase across Australia on the back of surging commodity prices*"
http://www.abc.net.au/news/rural/20...s-job-numbers-rising-commodity-prices/8676116


----------



## Dona Ferentes

China's thirst for Australian *iron ore *has just registered an all time record of $9.4 billion in a single month, helping to drive a big bounce in overall exports. Preliminary figures from the Australian Bureau of Statistics showed the bounce in exports means Australia is likely to have recorded a 30th successive trade surplus in June.

June exports to China increased by 7 per cent, or about $1 billion, to $14.5 billion. The jump in iron ore exports to China pushed the total exports of iron ore for financial year 2020 to *over $100 billion*, representing more than a quarter of Australia’s total goods exported for this period, and likely to provide a comparatively small but helpful boost to the government's deficit of $85.8 billion.


----------



## Chronos-Plutus

https://markets.businessinsider.com/commodities/iron-ore-price



https://www.barchart.com/futures/quotes/YY*0/futures-prices


----------



## Trav.

Some good news for the Australian Iron Ore companies









						Iron ore lifts on Vale's lower output estimate
					

The Brazilian miner lowered its estimate for production of the steelmaking material for this year and missed expectations for 2021.




					www.afr.com
				




extract


----------



## Trav.

Some of the bigger companies below all had a good day.


----------



## Miner

An _*irony*_ on *iron* ore news - bad for Vale and rejoice for Australian iron ore industries. 








						Fire at Vale iron ore terminal could cut shipments by 32m tonnes – sources
					

Replacement of shiploader boom could take months and hit Vale's shipping capacity in 2021.




					www.mining.com


----------



## qldfrog

For people believing there are other markets to go to if/when China blocks us:
and do not forget that our competitive advantage (shorter shipping distance) can turn in a major disadvantage if we try to redirect anywhere but Japan and Korea. And with Biden in power and control, China has free reign (pun intended)


----------



## Dona Ferentes

from the latest BHP quarterly

_a 35% improvement in the average realised price of iron ore to $US103.78 a tonne _
_updated its guidance for the full year – has increased to between 245 million tonnes and 255 million tonnes, reflecting the restart of Samarco pellet operation in Brazil in December. (it was previously 244 to 253 million tonnes)._
_Including shares in production held by shareholders in some of the mines, BHP is looking at between 276 million tonnes and 286 million tonnes of iron ore shipments for the financial year to June 30._
_produced 128.4 million tonnes of iron ore (145 million tonnes on a 100% basis), a rise of 6% on the six months to December, 2019._


----------



## basilio

Update from Share Cafe  on Iron Ore prices.
Some significant observations

Current Iron Ore prices falling because of reduced China demand
New China policy in place to ensure a long term reduction in steel demand as part of low carbon initiatives
The new policy will reduce demand for lower quality  iron ore, 58% fines  (mostly Australian source)
And yes China is intending to reduce its dependence on Australian iron ore.









						Poor Start to Feb for Iron Ore – ShareCafe
					

Contrary to historical trends, Iron ore prices are down sharply in February ahead of the Lunar New Year Festival starting February 11.




					www.sharecafe.com.au


----------



## basilio

New directions in Hydrogen based steel production for Australian miners.









						These billionaires believe green hydrogen will provide a carbon-free future for iron ore mining - Stockhead
					

Andrew Forrest's groundbreaking speech heralding Fortescue Metals Group's (ASX:FMG) move into green hydrogen for steel production has grabbed headlines.




					stockhead.com.au
				




*Carbon-free green hydrogen is being embraced by iron ore miners for home-grown steel and iron pellet production*
*ASX company Iron Road to join FMG and GFG Alliance as green hydrogen iron ore companies in Australia*
*‘The production of ‘green pellets’ offers Iron Road the opportunity to diversify its product streams’ Iron Road said*


----------



## basilio

You can take your pick on what is happening/going to happen with Iron Ore prices. 
Interesting to see the different takes.


----------



## basilio

Seems as if the demand and price for higher quality ore is picking up. And the current price is still holding very well. Great news for the Feds and shareholders in FMG and other pure iron plays. (Just ignore the war drums..)









						Steel producers willing to pay premium prices to secure higher-grade iron ore: report - Stockhead
					

High-grade iron ore will become sought-after by steel mills as they strive to achieve higher quality production with fewer environmental emissions.




					stockhead.com.au


----------



## rederob

basilio said:


> Seems as if the demand and price for higher quality ore is picking up. And the current price is still holding very well. Great news for the Feds and shareholders in FMG and other pure iron plays. (Just ignore the war drums..)
> 
> 
> 
> 
> 
> 
> 
> 
> 
> Steel producers willing to pay premium prices to secure higher-grade iron ore: report - Stockhead
> 
> 
> High-grade iron ore will become sought-after by steel mills as they strive to achieve higher quality production with fewer environmental emissions.
> 
> 
> 
> 
> stockhead.com.au



Maybe ok news, but not actually the best news: https://www.sharecafe.com.au/2021/04/13/oz-ore-exports-continue-to-lose-ground-to-brazil/


----------



## sileverback

HI
I trade the asx200 index and iron ore is often a large mover/impact on the index. I've tried to access various web sites to track futures prices reliably but got frustrated with outages, unreliable feeds etc . like for Singapore and Dalian exchanges. This is about 12 months ago.
Have things changed? Can you recommend something highly reliable free or paid to track daily trading. Is the Dalian the best market to track for correlation to 'iron ore' moves in the Australian market


----------



## Joules MM1

sileverback said:


> HI
> I trade the asx200 index and iron ore is often a large mover/impact on the index. I've tried to access various web sites to track futures prices reliably but got frustrated with outages, unreliable feeds etc . like for Singapore and Dalian exchanges. This is about 12 months ago.
> Have things changed? Can you recommend something highly reliable free or paid to track daily trading. Is the Dalian the best market to track for correlation to 'iron ore' moves in the Australian market



take a look here (?)








						Ironore — TradingView
					

ironore — Check out the trading ideas, strategies, opinions, analytics at absolutely no cost!




					www.tradingview.com


----------



## basilio

Upward pressure on iron ore prices  is still rising. Shipping delays are one trigger for the latest jump but overall  world demand for steel has jumped sharply as well. All of the iron ore sellers registered sharp increase in SP today









						Iron ore price jumps as Brazil, Australia shipments delayed
					

Shipments from Australia and Brazil fell by 4m tonnes compared to previous week.




					www.mining.com


----------



## greggles

The Iron Ore boom may have quite a bit further to go yet: https://www.afr.com/chanticleer/market-may-be-underestimating-iron-ore-boom-20210421-p57l2m

With Brazil having supply issues, the most efficient and profitable ASX-listed iron ore miners should see continued share price gains in the short term.


----------



## Dona Ferentes

On Wednesday the price of 65% Fe Brazil fines was a record $US221.90 a   tonne, up 12.6% from $US197.10 a tonne at the start of April.

 That saw the price margin over 62% Fe fines hit a record $US33.67 a tonne on Wednesday, up from $US29.50 a tonne on 01 April.

 The premium over 58% Fe fines on Wednesday was also a record ....  a massive $US60 a tonne.

*In the past year the price of all three iron ore types has more than doubled*.


----------



## Garpal Gumnut

greggles said:


> The Iron Ore boom may have quite a bit further to go yet: https://www.afr.com/chanticleer/market-may-be-underestimating-iron-ore-boom-20210421-p57l2m
> 
> With Brazil having supply issues, the most efficient and profitable ASX-listed iron ore miners should see continued share price gains in the short term.



I'm heavily riding the Iron Ore boom. I'm not as bullish as Chanticleer but, hey, the horse is running well and the punters in the stands are cheering and waving their arms about.

gg


----------



## Value Collector

Dona Ferentes said:


> On Wednesday the price of 65% Fe Brazil fines was a record $US221.90 a   tonne, up 12.6% from $US197.10 a tonne at the start of April.
> 
> That saw the price margin over 62% Fe fines hit a record $US33.67 a tonne on Wednesday, up from $US29.50 a tonne on 01 April.
> 
> The premium over 58% Fe fines on Wednesday was also a record ....  a massive $US60 a tonne.
> 
> *In the past year the price of all three iron ore types has more than doubled*.



Yep, because it is because the discount or premium is based on percentages, as the bench mark price grows the premiums and discounts get large in dollar terms.

for example a 10% discount on $100 is $10, but 10% of $200 is $20.

so the aren’t actually “record high” discounts or premiums when you think of them as a percentage, they are within the range of fluctuations seen over the years, if fact a few years ago the discounts were about 30% at one stage, much higher than today.


----------



## Dona Ferentes

Value Collector said:


> Yep, because it is because the discount or premium is based on percentages, as the bench mark price grows the premiums and discounts get large in dollar terms.  ... for example a 10% discount on $100 is $10, but 10% of $200 is $20.
> 
> so the aren’t actually “record high” discounts or premiums when you think of them as a percentage, they are within the range of fluctuations seen over the years, if fact a few years ago the discounts were about 30% at one stage, much higher than today.





_..... Some commentators in China believe there’s a good chance the price of 65% Fe fines could reach $US230 a tonne in the near future.

There’s a shortage – Brazil can’t produce enough of the product to meet rising demand from Chinese mills which want the higher quality ore to reduce pollution (it requires less sintering before being used in blast furnaces) and the yield is higher than using 62% Fe fines or the 58% product.  Brazilian analysts expect Vale’s production to pick up this month (as it did in March when Brazilian iron ore exports surged 32.6% from low February)

While there’s tens of millions of tonnes of 62% and 58% (and 62% Fe low silica and a couple of other one-off grades) in Chinese stockyards at ports and steel mills, there’s less than one million tonnes of the 65% of the Carajas (Brazil) fines at Chinese ports.

This shortage, plus hefty profit margins for most Chinese mills and the continuing crack down on pollution and capacity means the mills want as much of the 65% product as possible. They are currently being forced to blend it with the 62% product from Australia to maintain blast furnace campaigns and maximise the yield of crude steel from each tonne.

The high profit margins mean the mills can afford to offer more for the 65% product from Brazil. That has seen an expansion in the premium for 65% over 62% and 58% product from Australia and other countries_.









						Vale the Big Winner in Ore Wars – ShareCafe
					

For all the talk about how BHP, Rio Tinto and Fortescue are doing well in the current iron ore price boom, the clear winner is the recovering Brazilian giant Vale.




					www.sharecafe.com.au


----------



## basilio

Well the iron ore miners (and their shareholders   )  are  making out like bandits at the moment.

And of course the Government is getting an excellent fillup to its tax take - just in time for a budget.
Shame the unemployed will just have to starve off into the sunset.


----------



## Dona Ferentes

that is for 62 Fe


----------



## Sean K

Are iron ore plays turning into a short, or are Treasury and Bloomberg dreaming with pullbacks to $55 or $120 in nine months?


----------



## greggles

It's difficult to predict, but I think a price decline of that magnitude is unlikely and Treasury is underestimating the 2022 spot price for their own purposes. I suppose it's better to be conservative in case things do go pear shaped.

The iron ore spot price going forward will depend largely on supply and global economic growth. Will governments try to stimulate growth through massive infrastructure projects? Will iron ore production catch up with demand? Too many variables to accurately predict how things are going to play out.


----------



## Value Collector

kennas said:


> Are iron ore plays turning into a short, or are Treasury and Bloomberg dreaming with pullbacks to $55 or $120 in nine months?
> 
> View attachment 124142



$120 is pretty likely eventually, who knows when though, $55 is just a conservative number used for budgeting.

eg, if you are doing your household budget it’s best to work it out on there basis of not getting over time or a Christmas bonus, it’s better to surprise and delight than shock and disappoint.


----------



## Garpal Gumnut

greggles said:


> It's difficult to predict, but I think a price decline of that magnitude is unlikely and Treasury is underestimating the 2022 spot price for their own purposes. I suppose it's better to be conservative in case things do go pear shaped.
> 
> The iron ore spot price going forward will depend largely on supply and global economic growth. Will governments try to stimulate growth through massive infrastructure projects? Will iron ore production catch up with demand? Too many variables to accurately predict how things are going to play out.






Value Collector said:


> $120 is pretty likely eventually, who knows when though, $55 is just a conservative number used for budgeting.
> 
> eg, if you are doing your household budget it’s best to work it out on there basis of not getting over time or a Christmas bonus, it’s better to surprise and delight than shock and disappoint.




These projections I would agree are for budgeting purposes.

Who would have thought Iron Ore 12 months ago would now be double it's price then? 

Saying it will drop to $55 is as likely as saying it will rise to $400 imo. 

Ask the virus. 

gg


----------



## over9k

Classic underpromise/overdeliver. 

Now next year when it's not nearly that bad they can be all "things are much better than anticipated (thanks to us)" and if they go pear shaped, then they foresaw it (so are obviously so competent as to be able to tell these things). 

It's politics, nothing more.


----------



## Gunnerguy

As we all know there is risk in all we do, especially in investments. With the discussion on IO price, started by Josh, I am asking myself the following ...

With the current animosity between Beijing and Canberra what chance is there that Beijing will cancel/reduce the purchases of IO from Australia as this has occurred with other Australian exports. We can all discuss the various aspects of growth/vaccines/ geopolitics/commodity growth/stimulus/warehouse capacity/trade/FE content, however, I think this is an extremely important question not only for our IO Companies, but the economy and Government tax revenue. To make it simpler .....

'What chance do you think that Beijing will enact some political trade 'action' (ban, reduce, cancel) on the importing of Australia Iron Ore, that will have an impact on the Iron Ore price ?

Simply answer a percentage (I couldn't find a poll facility on ASF), so we can all see what 'the community' think.

60%.

Gunnerguy


----------



## over9k

Gunnerguy said:


> As we all know there is risk in all we do, especially in investments. With the discussion on IO price, started by Josh, I am asking myself the following ...
> 
> With the current animosity between Beijing and Canberra what chance is there that Beijing will cancel/reduce the purchases of IO from Australia as this has occurred with other Australian exports. We can all discuss the various aspects of growth/vaccines/ geopolitics/commodity growth/stimulus/warehouse capacity/trade/FE content, however, I think this is an extremely important question not only for our IO Companies, but the economy and Government tax revenue. To make it simpler .....
> 
> 'What chance do you think that Beijing will enact some political trade 'action' (ban, reduce, cancel) on the importing of Australia Iron Ore, that will have an impact on the Iron Ore price ?
> 
> Simply answer a percentage (I couldn't find a poll facility on ASF), so we can all see what 'the community' think.
> 
> 60%.
> 
> Gunnerguy



This is what I meant about political risk GG - how do you quantify it? 

They had to run rolling blackouts and bring in diesel generators when they blocked the coal imports so that kind of shows the level they'll go to. 


This is also why I hate a lot of quant analysis - there's just too many things that you simply cannot quantify. You'd have to have an ear to the door of a lot of closed-door meetings in canberra to really have a proper clue what's going to happen next. 

Unlike using diesel generators in place of coal, I don't see a substitute for iron ore for china. Having said that, it wouldn't take much of it being cut off for australia to REALLY feel the pain. 

In short, it's something that BOTH sides are really sensitive to and probably the last line that the chinese government will cross - if they do something with iron ore then NOTHING is off the table from there on out. 

Watch this space!


----------



## Gunnerguy

over9k said:


> This is what I meant about political risk GG - how do you quantify it?
> 
> They had to run rolling blackouts and bring in diesel generators when they blocked the coal imports so that kind of shows the level they'll go to.
> 
> 
> This is also why I hate a lot of quant analysis - there's just too many things that you simply cannot quantify. You'd have to have an ear to the door of a lot of closed-door meetings in canberra to really have a proper clue what's going to happen next.
> 
> Unlike using diesel generators in place of coal, I don't see a substitute for iron ore for china. Having said that, it wouldn't take much of it being cut off for australia to REALLY feel the pain.
> 
> In short, it's something that BOTH sides are really sensitive to and probably the last line that the chinese government will cross - if they do something with iron ore then NOTHING is off the table from there on out.
> 
> Watch this space!



Percentage ??


----------



## over9k

I can't give you one, that's the problem lol. 

I could guess one and say 50/50, but that's no help at all.


----------



## Gunnerguy

over9k said:


> I can't give you one, that's the problem lol.
> 
> I could guess one and say 50/50, but that's no help at all.



Over9k
That’s the whole point !
It’s difficult for all, and no one knows the answer. Just trying to get a ‘subjective’ gauge from the community. 
It’s like an HR job interview question, there’s no right or wrong answer, and answer.
I’m 60%, and your 50%. No questions, no reasoning, just wondering.
I just think it’s a valid question in the current climate for us all to consider.
Gunnerguy


----------



## basilio

Still no indication that iron ore prices are receding.

Financial Times story indicates that  predicted supply of ore from miners is reducing for a range of reasons. A reduction in supply would hold up the price as well.



			https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=&ved=2ahUKEwj9l_zO9vfxAhUizzgGHfs9BwQQ0PADegQIBxAB&url=https%3A%2F%2Fwww.ft.com%2Fcontent%2Fd7db853f-2d85-45de-970b-bafff930fc9f&usg=AOvVaw1EbgcheHqwnC1oJQifRYH9


----------



## basilio

Another interesting perspective on the boom in iron ore .  Worth checking out.  (in particular note  the date)

Iron ore: It's (not) different this time​  There’s a popular assumption that iron ore prices will stay high. But, as Gaurav Sodhi explains, the best solution to high prices is…high prices.









						Iron ore: It's (not) different this time
					

There’s a popular assumption that iron ore prices will stay high. But, as Gaurav Sodhi explains, the best solution to high prices is…high prices. Find out more at Intelligent Investor.




					www.intelligentinvestor.com.au


----------



## divs4ever

to be honest ( and i hold a few iron ore producers ) i can't see why the price is so high , unless everyone is secretly building war machines  , where is the steel/iron going  , yes this rise is nice for me  , but surely this is premature in the mining investment cycle ( or is the market thinking new mining investment will freeze  )


----------



## Beaches

basilio said:


> Another interesting perspective on the boom in iron ore .  Worth checking out.  (in particular note  the date)
> 
> Iron ore: It's (not) different this time​  There’s a popular assumption that iron ore prices will stay high. But, as Gaurav Sodhi explains, the best solution to high prices is…high prices.
> 
> 
> 
> 
> 
> 
> 
> 
> 
> Iron ore: It's (not) different this time
> 
> 
> There’s a popular assumption that iron ore prices will stay high. But, as Gaurav Sodhi explains, the best solution to high prices is…high prices. Find out more at Intelligent Investor.
> 
> 
> 
> 
> www.intelligentinvestor.com.au



Iron ore: It's (not) different this time -  *By Gaurav Sodhi  15 Nov 2010*​_The big three iron ore producers – Brazilian giant Vale, Rio Tinto and BHP Billiton  – account for over 60% of the world’s traded iron ore supply._​_Iron ore will still be a profitable industry, but despite the bravado of the optimistic, elevated prices never last forever. It’s not different this time._​
Although this story is from 2010 the story remains the same. The only change is that the big 3 have become the big 4 and Australia now outstrips Brazil. 

The mean price over the last 12 years has been around US$110/t. The current prices of over US$200/t cant last ... but there is a lot of money to be made before the price drops down below the mean again


_Vale – 300 million tonnes. ..._
_Rio Tinto – 286 million tonnes. ..._
_BHP – 248 million tonnes. ..._
_Fortescue Metals Group – 204 million tonnes. ..._



The mean price over the last 12 years has been around US$110/t


----------



## basilio

Certainly good economic news. 
Iron ore stars in June exports figures​ 
 Jul. 23, 2021, 06:30 AM                  

Australian exports have been upheld by metalliferous ores in June, with the category showing an 8 per cent increase and a fourth consecutive record month.Head of International Statistics at the Australian Bureau of Statistics (ABS) Andrew Tomadini said overall exports experienced a similar jump.“June 2021 recorded a monthly export value above $40 billion. Exports increased 8 per cent to $41.3 billion, with significant increases in metalliferous ores, coal, non-monetary gold and gas,”




__





						Iron ore stars in June export figures: ABS
					

Australian exports have been upheld by metalliferous ores in June, with the category showing an 8 per cent increase and a fourth consecutive recor...




					markets.businessinsider.com


----------



## divs4ever

am a little sad i didn't raise my target price on FMG a fair while back 

 but you try to do what you think is correct 

 and some lucky holder has my parcel  ( oh well i have been lucky elsewhere )

 i hope our government doesn't think this rally will last for ever


----------



## Gunnerguy

divs4ever said:


> am a little sad i didn't raise my target price on FMG a fair while back
> 
> but you try to do what you think is correct
> 
> and some lucky holder has my parcel  ( oh well i have been lucky elsewhere )
> 
> i hope our government doesn't think this rally will last for ever



My STO Calls on FMG and BHP are both ITM. Just waiting to see when they get assigned to someone.
Gunnerguy


----------



## Value Collector

divs4ever said:


> to be honest ( and i hold a few iron ore producers ) i can't see why the price is so high , unless everyone is secretly building war machines  , where is the steel/iron going  , yes this rise is nice for me  , but surely this is premature in the mining investment cycle ( or is the market thinking new mining investment will freeze  )



Check out this video, the simple answer is that there is a shortage of iron ore compared to demand, because in a COVID-19 world, much more spending is being diverted to things rather than experiences.

I mean listen to what this video is saying about shipping containers leaving China, those things are 100% steel, and China is having to build so many because they aren’t being returned, not to mention that the products they are filled with are made of steel.


----------



## divs4ever

awesome more CHEAP shipping containers in the future ( i buy the old ones for storage on a static site  )


----------



## Value Collector

divs4ever said:


> awesome more CHEAP shipping containers in the future ( i buy the old ones for storage on a static site  )



Yep, good for the Chinese manufacturers of shipping containers (and the people supplying the iron ore), Bad news for the US shipping container manufacturers.

It’s also obviously not just shipping containers, there is a timber shortage due to super high demand, and if people are buying timber, they will also be buying nails, screws, bolts, saw blades.

not to mention those is happening right across the economy in many sectors, the sectors that are suffering like tourism don’t consume much steel per dollar spent, but those industries that are thriving consume a much higher rate of steel per dollar spent.


----------



## Miner

Iron ore price slumpedvlike mayhem.
What domino effect is going to happen in market with the prices of bhp, Rio  and mid caps ?


----------



## divs4ever

despite adding via  the BHP DRP scheme  no longer being in my best interest , i would be willing to add extra BHP at the right price ( say sub $18 )

 i am keeping an eye on MGX  just in case the share  prices  slides into an appealing price ( sub 75c ) for me to add extra 

 i still think this 'commodity boom' has arrived too early in the economic cycle 

 i doubt GRR sliding back below 15c ( but you never know )

 and i suspect MIN will not retrace to my buy-in price , either

 now DRR  is one that MIGHT  come down to my target price ( to add more )

 but one should watch closely production and logistics costs


----------



## Miner

divs4ever said:


> despite adding via  the BHP DRP scheme  no longer being in my best interest , i would be willing to add extra BHP at the right price ( say sub $18 )
> 
> i am keeping an eye on MGX  just in case the share  prices  slides into an appealing price ( sub 75c ) for me to add extra
> 
> i still think this 'commodity boom' has arrived too early in the economic cycle
> 
> i doubt GRR sliding back below 15c ( but you never know )
> 
> and i suspect MIN will not retrace to my buy-in price , either
> 
> now DRR  is one that MIGHT  come down to my target price ( to add more )
> 
> but one should watch closely production and logistics costs



What about tomorrow's market as the trend has created from Wuhan lockdown


----------



## divs4ever

have given up on prediction , i only plan for what i will do if the markets ( and share prices ) move  far enough in a direction ( i have a plan for UP and DOWN  )

 call it a reactive  ( but flexible  ) style  , luckily for me i have been 'cherry-picking ' in the dips  

 in many cases  i will suffer paper losses  rather  than capital losses  ( several holdings are up over 400% .. and have had the original investment capital rescued )  , i will not be bomb-proof ( a total market implosion ) but have some ability to cope wind strong headwinds


----------



## basilio

Miner said:


> Iron ore price slumpedvlike mayhem.
> What domino effect is going to happen in market with the prices of bhp, Rio  and mid caps ?




Settle down!! I don't think *anyone *expects iron ore to stay at $200 plus a ton.  Everyone knows production cost are around $15 a ton and that all the major players are making decent profits at anything over $70 a ton. The Chinese are fed up with being reamed so naturally they are moving heaven and earth to create alternatives.

I think it would totally unrealistic to expect long term iron prices to be stay over $100 ton. But human nature being what it is everyone on the current gravy train is taking every buck they can.


----------



## qldfrog

Miner said:


> What about tomorrow's market as the trend has created from Wuhan lockdown



Got lucky after a pretty bad july:
Grr exited after a sl trigger, i had 2 reentry buys to fmg and grr yesterday.
None were executed and were cancelled this morning..
Will be interesting.i suspect the asx might fall today but who knows...


----------



## Beaches

No need to get carried away just yet
The average price for the last 12 months has been around US$165/t. The current price is still $25/t over that average price and may even stablise around the current levels in the short term.

It was never possible for the price to stay over $200/t. 12months ago every holder of BHP RIO and FMG would have been over the moon if you told them the price would average US$165/t

The price is unlikely to move under a range of $100/t $120t until the demand for steel drops. With the current infrastructure spend in all major economy countries, the steel demand looks locked in for at least another 12 to 18 months, barring any new major world issues


----------



## Value Collector

basilio said:


> Settle down!! I don't think *anyone *expects iron ore to stay at $200 plus a ton.  Everyone knows production cost are around $15 a ton and that all the major players are making decent profits at anything over $70 a ton. The Chinese are fed up with being reamed so naturally they are moving heaven and earth to create alternatives.
> 
> I think it would totally unrealistic to expect long term iron prices to be stay over $100 ton. But human nature being what it is everyone on the current gravy train is taking every buck they can.



Yep, Agreed.

I think long term Iron Ore will average about $90, but I am enjoying every day that it sits above $100.

The way I see things playing out is that when Iron Ore does eventually correct (Today, Tommorrow or next year no one knows when), we will see a lot of over reaction and panic,   Before people slowly realise it’s no the end of the world.

Take FMG for example, it’s currently price as if Iron ore was about $80, but you can bet when the Iron Ore price drops the speculators that have built up on the share register will panic sell, and the share price will drop like a stone for a while until they are replaced by people that have done their Math.


----------



## divs4ever

gee i don't know if FMG will drop enough to hit my targets  , but i waited 4 years for BPT  and then it was slide-city  , so i kept on adding 

 but yes i feel commodity prices ( most of them )  are unnaturally high currently 

 of course from another angle it might look like the US  dollar tanking


----------



## Value Collector

divs4ever said:


> gee i don't know if FMG will drop enough to hit my targets  , but i waited 4 years for BPT  and then it was slide-city  , so i kept on adding
> 
> but yes i feel commodity prices ( most of them )  are unnaturally high currently
> 
> of course from another angle it might look like the US  dollar tanking



What target do you have on FMG?

last time Iron Ore average $93, FMG paid a dividend of $1.76 for the year, that’s $2.51 including franking.

that’s more than a 10% dividend based on today’s price, and the next dividend is due in a month and likely to be $2 or more, so if you buy today it’s like you are really only paying $22 because you get the dividend shortly, which makes the return at $93 Iron ore price even higher than 10%, and Iron ore price is currently sitting well over $93 building excess dividends for the following dividend.


----------



## divs4ever

about $9  

 why so cruel   , 
FMG went to the foreign  investors  and borrowed in US dollars   

 now the real predators love squeezing the debt of a quality company  ( no fun grabbing a box of broken parts , unless you are the WES board )  

  freeze some funds here , renegotiate a new deal there 

 unless the governments ( state  and Federal ) protect FMG when needed  it is a big plump cash generating target  but might not be big enough to chew up the predator first ( remember the predator only needs access to funds, and does not need to be a success business itself )they used to be called Corporate Raiders but the new SPAC trend looks very similar .

has been a persistent trend of inaccurate analyst reports elsewhere on take-over victims , that stellar reputation of FMG  would be a shiny target as well 

 the question  that is always asked in such situations is 

will the loyal share-holders rush in and support management ( by voting and buying the cheaper shares , and any accelerated SPPs ) you can't trust the instos the bottom line is short-term profits and losses


----------



## Value Collector

divs4ever said:


> about $9
> 
> why so cruel   ,
> FMG went to the foreign  investors  and borrowed in US dollars
> 
> now the real predators love squeezing the debt of a quality company  ( no fun grabbing a box of broken parts , unless you are the WES board )
> 
> freeze some funds here , renegotiate a new deal there
> 
> unless the governments ( state  and Federal ) protect FMG when needed  it is a big plump cash generating target  but might not be big enough to chew up the predator first ( remember the predator only needs access to funds, and does not need to be a success business itself )they used to be called Corporate Raiders but the new SPAC trend looks very similar .
> 
> has been a persistent trend of inaccurate analyst reports elsewhere on take-over victims , that stellar reputation of FMG  would be a shiny target as well
> 
> the question  that is always asked in such situations is
> 
> will the loyal share-holders rush in and support management ( by voting and buying the cheaper shares , and any accelerated SPPs ) you can't trust the instos the bottom line is short-term profits and losses



I am not sure I understand  where you see the problem. If you like we can head over to the FMG thread and you can explain it to me, but here are some points I think take away the risk I think you might be talking about.

FMG have $0 net debt, meaning they have more cash sitting on the balance sheet than they have cash, so they could pay out their debt at any stage.

not to mention that the debt is long term bonds and not due to be paid back for quite some time.

the debt is also in US dollars, but that’s no issue because Iron Ore is traded in US dollars, so the debt is in the same currency as their earnings.

As for loyal share holders, we have an 800 pound gorilla by the name of Andrew Forrest that owns more than 35% of the shares, and he is the chairman of the board, So I see no risk of take over plays or other games


----------



## divs4ever

gorillas  can be shifted   look at TPG/TPM

 and Andrew Forrest seems to be the guy who will not 'fight dirty' when confronted with a rapacious predator

 i like AF because of the person he is  , but others might see him as an easy target ( with a very juicy company  just awash with cash-flow ) remember several analysts have been busted  for outright  lying  for pay  or part of the short-selling campaign ( and worse they publish only to selected  buddies   and certain media

 i also hold HSN ,  hold the debris of HHL ( now PCG ) and HHV ( now PIA )

 so i have seen what happens when gorillas are shifted

 i think in a world awash with free cash ( for some ) FMG is a prime target in Australia , small enough for a consortium to avoid FIRB and ACCC  probing  ( heck they have already tried on SYD  )

 cheers


----------



## qldfrog

divs4ever said:


> gee i don't know if FMG will drop enough to hit my targets  , but i waited 4 years for BPT  and then it was slide-city  , so i kept on adding
> 
> but yes i feel commodity prices ( most of them )  are unnaturally high currently
> 
> of course from another angle it might look like the US  dollar tanking



Or both high commodity prices and falling usd


----------



## Value Collector

divs4ever said:


> gorillas  can be shifted   look at TPG/TPM
> 
> and Andrew Forrest seems to be the guy who will not 'fight dirty' when confronted with a rapacious predator
> 
> i like AF because of the person he is  , but others might see him as an easy target ( with a very juicy company  just awash with cash-flow ) remember several analysts have been busted  for outright  lying  for pay  or part of the short-selling campaign ( and worse they publish only to selected  buddies   and certain media
> 
> i also hold HSN ,  hold the debris of HHL ( now PCG ) and HHV ( now PIA )
> 
> so i have seen what happens when gorillas are shifted
> 
> i think in a world awash with free cash ( for some ) FMG is a prime target in Australia , small enough for a consortium to avoid FIRB and ACCC  probing  ( heck they have already tried on SYD  )
> 
> cheers



There is no way Andrew wouldn’t put the boxing gloves on to defend FMG.

but what exactly are you worried about, what are the mechanics of the Possible situation you see happening?

I honestly can’t see any way some one could take advantage of FMG.


----------



## KevinBB

Value Collector said:


> I honestly can’t see any way some one could take advantage of FMG.



If the Berkshire Hathaway management weren't so set against resources, Fortesque would make an ideal addition to their portfolio. Fortesque is a cash generation machine, which is one of the attributes that Berkshire Hathaway dearly loves in its subsidiaries.

However, I do agree with you in that it would take a great deal for Forrest to agree part with Fortesque. Whether or not Berkshire Hathaway is willing to pay up, only the future will tell.

KH


----------



## divs4ever

and many predators are nowhere near as nice as Berkshire  ( who loves to gain positions with convertible bonds , preference shares and warrants )

 and the current SPAC trend means the predator  can do it without much of their money ( they don't even have to convince the investment banks this time  .. just pension funds and such )

 time will tell 

 it is just FMG would be such a juicy target


----------



## Value Collector

divs4ever said:


> and many predators are nowhere near as nice as Berkshire  ( who loves to gain positions with convertible bonds , preference shares and warrants )
> 
> and the current SPAC trend means the predator  can do it without much of their money ( they don't even have to convince the investment banks this time  .. just pension funds and such )
> 
> time will tell
> 
> it is just FMG would be such a juicy target



I think you are letting your imagination go a bit wild there, but either way, a take over offer would cause the price to rise, not drop.


----------



## basilio

I suspect that Twiggy will always be a buyer for FMG shares if the price dips unreasonably. He owns 35% already and  currently draws $2billion plus a year dividends.. (unreal isn't it ?) 

Earlier this year in late March  when there was a dip to around $18-19 as a result of another negative stock analysis he bought 10,000,000 shares for $193m at market. Not a bad deal was it ?


----------



## divs4ever

i believe there are limits to how rapidly a major holder can accumulate more stock ( without a formal take-over declaration )

 HOWEVER  a consortium of major holders might decide they control 70% of the company and make a move to take the company private ( as happened to me in TMM )


----------



## Value Collector

divs4ever said:


> i believe there are limits to how rapidly a major holder can accumulate more stock ( without a formal take-over declaration )
> 
> HOWEVER  a consortium of major holders might decide they control 70% of the company and make a move to take the company private ( as happened to me in TMM )



I guess you could imagine situations for any business listed on the stock exchange, better just stick to cash if those sorts of fantasies keep you up at night.


----------



## divs4ever

if they were solely my fantasies , there would be no regulations  on such 

 N. Politis ( of APE fame ) is very aware  of the limits to his accumulation of APE shares 

he currently controls 27.06% of the company but that has been higher before the AHE merger  which diluted his holding % ( not the number of shares held )

 and TMM going private happened to me several years ago ( despite me voting against it )

 the question is will Twiggy  need to negotiate such rules if his company is the target of a hostile take-over 

 plenty of directors in other companies eagerly take the first offer


----------



## Value Collector

divs4ever said:


> if they were solely my fantasies , there would be no regulations  on such
> 
> N. Politis ( of APE fame ) is very aware  of the limits to his accumulation of APE shares
> 
> he currently controls 27.06% of the company but that has been higher before the AHE merger  which diluted his holding % ( not the number of shares held )
> 
> and TMM going private happened to me several years ago ( despite me voting against it )
> 
> the question is will Twiggy  need to negotiate such rules if his company is the target of a hostile take-over
> 
> plenty of directors in other companies eagerly take the first offer



The fantasy is that FMG could  be the victim of a hostile take over, but as I said even in the event of a take over the share price would go up, not down.


----------



## divs4ever

time will tell


----------



## Value Collector

divs4ever said:


> time will tell



It always does


----------



## Dona Ferentes

Value Collector said:


> It’s also obviously not just shipping containers, ....



Could put this in the Inflation thread, or Baltic Dry, or any number of places. Bunnings?



> *Unprecedented’, ‘abnormal’ and ‘astronomical’.* Those are some of the phrases that have been used to describe the post-Covid global shipping crisis, which has seen container shipping rates quadruple since the start of the year. Take any freight index and it will show you just how expensive it has gotten to send a 40ft container from one end of the world to the other. ....






> ....Freight rates from *China to Australia have soared as well*, but are cheaper than levels being paid by importers in North America and Europe. And that is a big problem. As container rates run hot on the world’s most popular trade lanes, increasingly ships which previously ran the routes from Shanghai to places like Australia, Africa, New Zealand and South America are being placed on more favourable routes.











						'UNPRECEDENTED': The global shipping crisis could take years to unwind... and here's why Australia could be hardest hit - Stockhead
					

'Unprecedented', 'abnormal' and 'astronomical'. Those are some of the phrases that have been used to describe the post-Covid global shipping crisis.




					stockhead.com.au


----------



## divs4ever

Value Collector said:


> It always does



 just a shame my crystal ball is broken , or a could dial up some spoilers ( glimpses of the future )


----------



## Dona Ferentes

The spot price of iron ore plunged near 15 per cent on Thursday, extending a rapid retreat, as demand for the steel-making material seemingly fades at an unprecedented pace as supplies edge higher.

The *spot price has now tumbled more than 44 per cent *from the record high set in May, based on either Fastmarkets MB or S&P Global Platts pricing.

Fastmarkets MB said its benchmark price fell $US20.73 to $US132.66 a tonne on Thursday; it put the peak at $US237.57 on May 12. S&P Global Platt’s benchmark fell $US22.85 to $US130.02 on Thursday; it put the peak at $US233.10 on May 12.

The most traded iron ore futures on the Dalian Commodity Exchange, for January delivery, closed down 7.2 per cent to 763 yuan ($US117.44) per tonne, after plunging to 8 per cent earlier during the session.

Steel prices on the Shanghai Futures Exchange also tumbled.


----------



## basilio

Is anyone aware if  actual tonnages of ore have fallen in the last few weeks ? We know the price has dropped but at $160 a ton the miners are still  doing very well. Far more loss IMO if sales start to slide.


----------



## divs4ever

there was some reports of reduced activity in certain ports  , at least one in China and one in the US
 so are the tonnage slides because of demand or logistics


----------



## Dona Ferentes

China’s top steel industry executives and senior government officials outlined a strategy for achieving the five-year targets in an article published this week, which highlights the Chinese government’s frustration with volatile iron ore prices and its desire to follow Japan’s lead by investing heavily in offshore mines.

The article published in the state-backed _Economic Daily_ singled out Australia and Brazil for dominating China’s imports of the steel-making ingredient.


> “_The control of overseas iron ore resources is obviously insufficient, and more than 80 per cent of the import volume comes from Australia and Brazil. The risks to resource security are prominent_,” said Chen Ziqi, a senior executive at China International Engineering Consulting Corp, a major adviser to the Chinese government on investment and construction.




Mr Chen outlined a target to have mines with majority Chinese equity stakes providing more than 20 per cent of imported iron ore by 2025, compared with 8 per cent currently. The article noted that overseas mines partly owned by Japanese interests accounted for 60 per cent of that country’s imports.

Mr Chen acknowledged the high risks in his comments and noted most of the world’s high-quality iron ore resources had already been carved up by developed countries. 


> “_Only low exploration levels, poor resource conditions, large investment scales, long return periods, and backward infrastructure are left to Chinese enterprises. Risky projects_,” he said.




😱😥


----------



## Dona Ferentes

After the dip to around $90, there's life in the IO price.

Overnight, 

Iron ore +3.3% to $US123.51 a tonne


----------



## Ann

Here is my current chart for Iron Ore, I am not at all bullish on this. There appears to be an assortment of prices for Iron Ore. I am not too fussed as long as I use the same chart for consistency. Why the differences?  I am not 100% sure but it may be the prices are drawn from different places as in the Singapore Metals exchange or Iron ore prices refer to Iron Ore Fine China Import 63.5 percent grade Spot Cost and Freight for the delivery at the Chinese port of Tianjin. This last price is where Trading Economics gets their price. 

The higher price @Dona Ferentes is quoting may be a futures contract or a spot price somewhere. It may well be my chart is displaying the futures contract from the August contract. https://www.barchart.com/futures/quotes/C0*0/futures-prices
I am not sure. It may be the difference between the spot price and the futures price. I know IC charts can differ slightly as closing prices can be taken from different exchanges. That is why there may be discrepancies occasionally. Anyhow, not having made that any clearer for anyone, here is my chart for Iron Ore.

Overhead resistance lines and a falling trendline and battling well under the 200dsma.


----------



## Dona Ferentes

Ann said:


> The higher price @Dona Ferentes is quoting may be a futures contract or a spot price somewhere. ,



Hi there, I got that number from the daily update sourced from Reuters and / or Bloomberg. Usually dropped into the Market Talk in the AFR most days.

Tried to check it's attribution but there was no link . I think it is 62Fe at Dalian spot price, which is, if not a Benchmark,  a commonly quoted daily indicator

Here's the commodity numbers for Saturday morning.

Spot gold +0.7% to $US1826.95 an oz
Brent crude -2.1% to $US77.84 a barrel
US oil -2.3% to $US75.20 a barrel
Iron ore +1.2% to $US120.75 a tonne


----------



## Ann

Dona Ferentes said:


> Hi there, I got that number from the daily update sourced from Reuters and / or Bloomberg. Usually dropped into the Market Talk in the AFR most days.
> 
> Tried to check it's attribution but there was no link . I think it is 62Fe at Dalian spot price, which is, if not a Benchmark,  a commonly quoted daily indicator
> 
> Here's the commodity numbers for Saturday morning.
> 
> Spot gold +0.7% to $US1826.95 an oz
> Brent crude -2.1% to $US77.84 a barrel
> US oil -2.3% to $US75.20 a barrel
> Iron ore +1.2% to $US120.75 a tonne




Just one of life's little mysteries I guess Dona. Perhaps I will spend a bit of time on IC and see if Colin Twiggs explains where he got his price, probably should have done that in the first place. However, as that is the only Iron Ore price he has on his charts I am stuck with that one!


----------



## divs4ever

Dona Ferentes said:


> China’s top steel industry executives and senior government officials outlined a strategy for achieving the five-year targets in an article published this week, which highlights the Chinese government’s frustration with volatile iron ore prices and its desire to follow Japan’s lead by investing heavily in offshore mines.





 as a holder of MGX and GRR , i am wondering  what the heck  these execs are talking about  , where the Chinese have seen good value  they have been chest deep  , investing in almost any mine they can get a stake in  , and have been doing this for years , although i notice Ms. Rinehart  preferred South Korean partners 

 but let's see i  suspect China will invest more in developing nations with iron deposits  although they will have to be quick India will soon work out they need to do the same


----------



## Dona Ferentes

Ann said:


> Here is my current chart for Iron Ore, I am not at all bullish on this. There appears to be an assortment of prices for Iron Ore.



the chart is based on London Metals Exchange. But even they seem to have a variety of reference prices. As long as yr chartist uses the same data source all the time, then you have a trend that means something !

_"The LME publishes a set of daily reference prices that are used the world over by industrial and financial participants for referencing, hedging, physical settlement, contract negotiations, margining and portfolio evaluations.

"Based on some of the most liquid trading sessions of the day_*, LME prices are good indicators of where the market is at any point in time.*

_"The LME Official and Settlement prices, are based on trading activity on the Ring. The Unofficial and Closing Prices are based on trading activity on LMEselect. The LME Asian Reference Price is calculated using the volume-weighted average of trades transacted on LMEselect during the most liquid period of Asian trading hours_....






						LME reference prices | London Metal Exchange
					

LME reference prices




					www.lme.com


----------



## Ann

Dona Ferentes said:


> the chart is based on London Metals Exchange. But even they seem to have a variety of reference prices. As long as yr chartist uses the same data source all the time, then you have a trend that means something !



Thanks Dona, that saves me from hunting through IC. I had a feeling IC prices were based on LME but when I looked I couldn't find an Iron Ore price on LME.

As you say, using the same data source to chart keeps the consistency.


----------



## basilio

Iron ore prices steadily rising. No point thinking about prices of 2021 but at these levels all the miners will be in good profits.


----------



## basilio

Iron ore still rising.  At the moment the most significant news is  heavy rain in Brazil closing down operations at Vale.  All Oz miners have jumped 3-4%.

The situation of the tailings dams remains a concern. The history of  recent collapses in these dams is not good (for Vale)

*In December, Brazil had 40 tailings dams on the emergency level, 36 of which are in Minas Gerais, according to the country’s mining regulator. Three of those — all owned by Vale — are at the highest alert of level 3. 
*
_








						Iron ore price rises as heavy rains force miners to halt operations in Brazil
					

Heavy rains disrupted southeastern Brazil’s iron ore industry, with Vale among companies halting operations and regulators sent to monitor the impact on tailings dams.




					www.mining.com
				











						The 2019 Brumadinho tailings dam collapse: Possible cause and impacts of the worst human and environmental disaster in Brazil
					

On 25th January 2019, the tailings dam of the Brumadinho iron mine operated by Vale S/A failed catastrophically. The death toll stood at 259 and 11 pe…




					www.sciencedirect.com
				



_


----------



## divs4ever

when is the Asian Festive Season this year  , that might put a small speed bump  in things


----------



## basilio

Iron ore  prices still climbing.  January looks like being  a good month for  the usual suspects who will still be making very good profits.


----------



## basilio

More continuing  good news for iron ore shareholders.


----------



## basilio

At some stage , probably around $150, China will  seriously crack the xhits.


----------



## JohnDe

China and Russia are turning out to be great friends. Russia has the third biggest iron ore reserves in the world.


----------



## Dona Ferentes

basilio said:


> At some stage , probably around $150, China will  seriously crack the xhits.



Patience. Latest commodity spots:

Spot gold -0.03% to $US1806.27/oz
Brent crude +1.8% to $US91.04 a barrel
US oil +2.2% to $US90.20 a barrel
Iron ore n/a due to Asian Lunar holidays


----------



## basilio

Iron ore, like oil and other commodities, rising sharply. On the backs of  war and terror.


----------



## frugal.rock

Dow Jones Iron and Steel has been bouncing off all time highs lately. Again last night. 
Weekly chart.


----------



## eskys

frugal.rock said:


> Dow Jones Iron and Steel has been bouncing off all time highs lately. Again last night.
> Weekly chart.
> 
> View attachment 138759



Interesting to note that while commodities and oil were higher last night, they're red today. Investors and traders must be taking profits at their all time high. Some picking low hanging fruits in other sectors.


----------



## frugal.rock

Bonds are heading again.
Top 3 US banks all went to nearly 5% down but all recovered to only be around 0.5% to 1% down.
JPMorgan hit 52 week low on open.


----------



## eskys

frugal.rock said:


> Bonds are heading again.
> Top 3 US banks all went to nearly 5% down but all recovered to only be around 0.5% to 1% down.
> JPMorgan hit 52 week low on open.



That explains why the cap notes are up (those on my watchlist) Thanks, frugal.rock


----------



## frugal.rock

DJUSST
Almost looking set to punch new ATH's, again.
Daily chart.


----------



## eskys

frugal.rock said:


> DJUSST
> Almost looking set to punch new ATH's, again.
> Daily chart.
> 
> 
> View attachment 139157













CommSec

@CommSec
·
8h

Good morning, iron ore jumped US$9.90 or 7.3% to US$145.45 a tonne yesterday after China promised stronger policy measures to support the economy. #co

By the way, what do those abbreviations stand for, frugal. rock? DJSST and ATH?


----------



## frugal.rock

DJUSST is the Dow Jones index ticker or code.
ATH all time high


----------



## eskys

frugal.rock said:


> DJUSST is the Dow Jones index ticker or code.
> ATH all time high



Ahh, thank you, frugal.rock.......I've more than one brain freeze


----------



## qldfrog

https://www.scmp.com/economy/china-...mentally-solve-iron-ore-shortages-cornerstone
And








						Could Guinea’s junta sink China’s plans to wean itself off Australian iron ore?
					

Work is on hold at the China-backed Simandou mine, home to one of the biggest undeveloped reserves in the world.




					www.scmp.com
				




Which i read as:
Get out of FMG, Rio and buy juniors who will be taken over.


----------



## eskys

qldfrog said:


> https://www.scmp.com/economy/china-...mentally-solve-iron-ore-shortages-cornerstone
> And
> 
> 
> 
> 
> 
> 
> 
> 
> Could Guinea’s junta sink China’s plans to wean itself off Australian iron ore?
> 
> 
> Work is on hold at the China-backed Simandou mine, home to one of the biggest undeveloped reserves in the world.
> 
> 
> 
> 
> www.scmp.com
> 
> 
> 
> 
> 
> Which i read as:
> Get out of FMG, Rio and buy juniors who will be taken over.



I don't read it that way, qldfrog. I'd rather stick with the proven ones esp this day and age. Volatility is down a lot since the high, but risks are not entirely dead. Mining is a costly investment and upcoming mines are not in my trading strategy. Interesting article though, and what's the stock code, qldfrog?

By the way, Fe up Friday night.........










CommSec

@CommSec
·
6h

Good morning, iron ore rose by US$4.45 or 3% to US$151.35 a tonne after Beijing vowed to bolster capital markets and support the embattled property sector. Iron ore inventories at major Chinese ports fell for a fourth week


----------



## qldfrog

eskys said:


> I don't read it that way, qldfrog. I'd rather stick with the proven ones esp this day and age. Volatility is down a lot since the high, but risks are not entirely dead. Mining is a costly investment and upcoming mines are not in my trading strategy. Interesting article though, and what's the stock code, qldfrog?
> 
> By the way, Fe up Friday night.........
> 
> 
> 
> 
> View attachment 139284
> 
> CommSec
> @CommSec
> ·
> 6h
> 
> Good morning, iron ore rose by US$4.45 or 3% to US$151.35 a tonne after Beijing vowed to bolster capital markets and support the embattled property sector. Iron ore inventories at major Chinese ports fell for a fourth week



Basically, when the chinese press specifically talk about removing its dependencies on Australian iron and ask its companies and financial institutions to help and investigate partnerships and full purchase of miners, and these will not be FMG, Rio or BHP, i believe it is a fair bet that the current situation might NOT persist in 2 or 3y times.
I do agree with you on volatiity and market fragility but wonder if a stake in a proven resources junior with African or Asian lease might be a better bet, medium to long term.
Of course, nothing will change next week or trimester


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## eskys

qldfrog said:


> Basically, when the chinese press specifically talk about removing its dependencies on Australian iron and ask its companies and financial institutions to help and investigate partnerships and full purchase of miners, and these will not be FMG, Rio or BHP, i believe it is a fair bet that the current situation might NOT persist in 2 or 3y times.
> I do agree with you on volatiity and market fragility but wonder if a stake in a proven resources junior with African or Asian lease might be a better bet, medium to long term.
> Of course, nothing will change next week or trimester



I guess it's worth a punt on juniors if one can afford to lose their lunch money, qldfrog. I don't enjoy losing my money, so I won't be punting. Sorry I'm a stick in the mud....I don't know the grade of ore in those unknown mines, the geopolitical risks etc isn't something I can tolerate.......we can strike it rich in the unknown for a little risk (I'd rather hold on to my retarded money and make it slowly) All the best, anyway, I admire your courage and enterprising spirit, good luck (will come back later, need to hit the road now)


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## qldfrog

eskys said:


> I guess it's worth a punt on juniors if one can afford to lose their lunch money, qldfrog. I don't enjoy losing my money, so I won't be punting. Sorry I'm a stick in the mud....I don't know the grade of ore in those unknown mines, the geopolitical risks etc isn't something I can tolerate.......we can strike it rich in the unknown for a little risk (I'd rather hold on to my retarded money and make it slowly) All the best, anyway, I admire your courage and enterprising spirit, good luck (will come back later, need to hit the road now)



I do not say it is easy:
Need a lot of homework that i can not do either
African location, stable enough government or better one where China is already in charge, then proven resources ideally already operating.
What China can bring is $, infrastructure..aka railway to port, and stability via military financial strength.
Some will do the homework and benefit greatly, i will just try to avoid long and medium term iron miners in Australia.plenty of other miners resources to choose from


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## divs4ever

qldfrog said:


> https://www.scmp.com/economy/china-...mentally-solve-iron-ore-shortages-cornerstone
> And
> 
> 
> 
> 
> 
> 
> 
> 
> Could Guinea’s junta sink China’s plans to wean itself off Australian iron ore?
> 
> 
> Work is on hold at the China-backed Simandou mine, home to one of the biggest undeveloped reserves in the world.
> 
> 
> 
> 
> www.scmp.com
> 
> 
> 
> 
> 
> Which i read as:
> Get out of FMG, Rio and buy juniors who will be taken over.



 i hope you are incorrect there  i hold GRR and MGX  and am quite happy there ( although at current prices i should crystallize a profit )


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## eskys

qldfrog said:


> I do not say it is easy:
> Need a lot of homework that i can not do either
> African location, stable enough government or better one where China is already in charge, then proven resources ideally already operating.
> What China can bring is $, infrastructure..aka railway to port, and stability via military financial strength.
> Some will do the homework and benefit greatly, i will just try to avoid long and medium term iron miners in Australia.plenty of other miners resources to choose from



Chats open minds and I see with different eyes today. Just found out from divs post GRR and MGX pay divs. I've never bothered to look for alternatives before....always stuck on trading the 3 majors because I know them.

Divs, can you tell me the grade of ore in those mines? Thank you in anticipation.


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## eskys

divs4ever said:


> i hope you are incorrect there  i hold GRR and MGX  and am quite happy there ( although at current prices i should crystallize a profit )



Div, I thought a takeover will boost the price of your stocks, but in this case, you don't wish for that to happen. Why's that? 

In another thread, you were looking for potential takeover targets. Have you found any?


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## divs4ever

i try to avoid take-over targets  ( but of course time catches up with investors )  there is a tendency for a take-over to crystallize a LOSS , OR eject you from a very comfortable position  ( say EPX - Ethane Pipeline  where i had a very cosy position  as a reward for taking on extra risk )

 take the API take-over now almost complete   yes i make almost a 20 cent a share profit BUT i wanted a reasonable exposure to the healthcare industry  and  when the cash comes through  a top five holding will be cash  , which is very difficult to park sensibly  in the current climate 

LNK where i built a reasonable position is another  LNK looks like it will be death by a thousand asset sell-downs 

  so yes looking but trying to avoid them ( most of the time )

am still watching the 'lesser banks ' there is regular urging that some should merge  'to take up the big four ' i hope not , the Hayne Royal Commission  showed us what happens when certain businesses achieve 'pricing power '

another take-over space should be IT services  ( especially the ones selling 'enhanced cloud storage ' ) there are plenty of synergies there 

 i used to hold RIO  but sold out years ago  , i usually like small/mid-sized companies because they have sensible  paths of growth , and a well run company  can be nimble and and take small but pivotal opportunities  .. i bought EVN and NST  back when each had a single operating mine 

 huge companies tend to get bogged down in complexity  especially when trying to force growth ( 5% a year annual growth is  very difficult when  you are a whale  in a fish tank  , like say Australia  , but a goldfish , not such a problem )

 thanks for the thought  but sometimes small and profitable  is good for the portfolio as well  ( look at examples like BHP or WOW   as they strive to cut costs  in the name of better margins )

the OTHER problem with take-overs  is when they take the company private  so all you get is devaluing currency  ( not even the opportunity for scrip )


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## divs4ever

eskys said:


> Chats open minds and I see with different eyes today. Just found out from divs post GRR and MGX pay divs. I've never bothered to look for alternatives before....always stuck on trading the 3 majors because I know them.
> 
> Divs, can you tell me the grade of ore in those mines? Thank you in anticipation.




 MGX

Through most of 2021, limited mining access in the floor of the Main Pit confined production to lower grade material (55-57% Fe) from the lateral extents of the deposit and nearby satellite pits. Ore production in the December quarter was limited as anticipated and totalled 0.5 Mwmt for the December 2021 half-year. One shipment of fines was completed in the quarter. Shipments and ore quality will rise during the March and June 2022 quarters towards the Ore Reserve grade of 65% Fe, with the sales target for Koolan Island for the 2021/22 financial year being 1.7 Mwmt.

Shine Final ore sales from Shine achieved an average realised price of US$63/dmt FOB and US$59/dmt FOB for standard lump and fines respectively (~61% Fe).

 i am guessing plenty of the 55% Fe  , not so much of the better stuff 

 GRR

Table 2 North Pit Mineral Resources as at December 2020
Measured Resources ..Indicated Resources ..Inferred Resources TOTAL Resources
Tonnes (Mt) 117.9 87.8 39.3 245.0
DTR (%) 56.4 42.8 44.9 49.7
Fe (%) 67.7 67.8 68.3 67.8
Ni (%) 0.04 0.05 0.05 0.05
TiO2 (%) 0.96 0.89 0.82 0.91
MgO (%) 1.99 1.69 1.42 1.79
P (%) 0.010 0.010 0.010 0.010
V (%) 0.35 0.33 0.34 0.34
S (%) 0.05 0.08 0.09 0.07

 but since they are pelletizing and concentrating , i am guessing they are using some lower grade feed-stock as well 

 if the stuff is 67% ( as claimed ) how much processing does it need ??


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## eskys

divs4ever said:


> MGX
> 
> Through most of 2021, limited mining access in the floor of the Main Pit confined production to lower grade material (55-57% Fe) from the lateral extents of the deposit and nearby satellite pits. Ore production in the December quarter was limited as anticipated and totalled 0.5 Mwmt for the December 2021 half-year. One shipment of fines was completed in the quarter. Shipments and ore quality will rise during the March and June 2022 quarters towards the Ore Reserve grade of 65% Fe, with the sales target for Koolan Island for the 2021/22 financial year being 1.7 Mwmt.
> 
> Shine Final ore sales from Shine achieved an average realised price of US$63/dmt FOB and US$59/dmt FOB for standard lump and fines respectively (~61% Fe).
> 
> i am guessing plenty of the 55% Fe  , not so much of the better stuff
> 
> GRR
> 
> Table 2 North Pit Mineral Resources as at December 2020
> Measured Resources ..Indicated Resources ..Inferred Resources TOTAL Resources
> Tonnes (Mt) 117.9 87.8 39.3 245.0
> DTR (%) 56.4 42.8 44.9 49.7
> Fe (%) 67.7 67.8 68.3 67.8
> Ni (%) 0.04 0.05 0.05 0.05
> TiO2 (%) 0.96 0.89 0.82 0.91
> MgO (%) 1.99 1.69 1.42 1.79
> P (%) 0.010 0.010 0.010 0.010
> V (%) 0.35 0.33 0.34 0.34
> S (%) 0.05 0.08 0.09 0.07
> 
> but since they are pelletizing and concentrating , i am guessing they are using some lower grade feed-stock as well
> 
> if the stuff is 67% ( as claimed ) how much processing does it need ??



That's great info, divs, thank you.

I guess if it's 67% they can go straight into the furnace? I'll put these two on watch list, thanks again.


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## frugal.rock

@eskys
You might want to have a gawk into CUF and GWR which I believe are both producing. (not held)

If your at all interested in potential Hancock connections, LCY and BCK
 (I hold both of these)

Was getting ATH (all time high) alerts every night last week, mostly on opens...
See how we go this week...🍀


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## Value Collector

divs4ever said:


> MGX
> 
> Through most of 2021, limited mining access in the floor of the Main Pit confined production to lower grade material (55-57% Fe) from the lateral extents of the deposit and nearby satellite pits. Ore production in the December quarter was limited as anticipated and totalled 0.5 Mwmt for the December 2021 half-year. One shipment of fines was completed in the quarter. Shipments and ore quality will rise during the March and June 2022 quarters towards the Ore Reserve grade of 65% Fe, with the sales target for Koolan Island for the 2021/22 financial year being 1.7 Mwmt.
> 
> Shine Final ore sales from Shine achieved an average realised price of US$63/dmt FOB and US$59/dmt FOB for standard lump and fines respectively (~61% Fe).
> 
> i am guessing plenty of the 55% Fe  , not so much of the better stuff
> 
> GRR
> 
> Table 2 North Pit Mineral Resources as at December 2020
> Measured Resources ..Indicated Resources ..Inferred Resources TOTAL Resources
> Tonnes (Mt) 117.9 87.8 39.3 245.0
> DTR (%) 56.4 42.8 44.9 49.7
> Fe (%) 67.7 67.8 68.3 67.8
> Ni (%) 0.04 0.05 0.05 0.05
> TiO2 (%) 0.96 0.89 0.82 0.91
> MgO (%) 1.99 1.69 1.42 1.79
> P (%) 0.010 0.010 0.010 0.010
> V (%) 0.35 0.33 0.34 0.34
> S (%) 0.05 0.08 0.09 0.07
> 
> but since they are pelletizing and concentrating , i am guessing they are using some lower grade feed-stock as well
> 
> if the stuff is 67% ( as claimed ) how much processing does it need ??



GRR’s Ore only has about 33% Iron content doesn’t it? That’s why it is processed/concentrated into pellets before shipping.

Magnetite ores are generally very low grade, and require a lot of processing.


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## divs4ever

well it has required processing  even since i bought in  ( about a decade ago ) and if turning it into pellets  was essential for transport  FMG  and other WA mines would do it  , so i suspect  has to be concentrated  to hit the higher grades ( making the pellets  a value adding extra )

that said the BHP/Vale JV  was a pellet operation as well  so if the power costs are  cheap near the mine  processing ( and turning them into pellets makes commercial sense 

 some of those Pilbara miners  have some incredibly low production costs  but they don't seem to sell pellets ( or need to make them )


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## Value Collector

divs4ever said:


> well it has required processing  even since i bought in  ( about a decade ago ) and if turning it into pellets  was essential for transport  FMG  and other WA mines would do it  , so i suspect  has to be concentrated  to hit the higher grades ( making the pellets  a value adding extra )
> 
> that said the BHP/Vale JV  was a pellet operation as well  so if the power costs are  cheap near the mine  processing ( and turning them into pellets makes commercial sense
> 
> some of those Pilbara miners  have some incredibly low production costs  but they don't seem to sell pellets ( or need to make them )



The ore mines in the Pilbara is high grade Ore, in the industry it’s referred to as “direct shipping Ore”, meaning it is just mined and loaded on the ship with minimal processing.

However, low grade Ore (less than 50% FE content) is generally crushed, turned into a slurry, the Iron is pulled out of the slurry using magnets, then the “concentrate” is dried and baked into pellets that are 67%.

This is what FMG is doing at their new plant called “Iron Bridge”, and it’s what miners do all over the world when they run out of high grade shipping Ore, they begin mining the 90% of the other deposits that are low grade and pelletise them.

Watch this video, it’s an old video but it describes the process and reasons they invented it, at the 7 min mark in particular it describes it.


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## Value Collector

At the 3 min mark of this video it shows that the company from the old video above still use the same process today that they invested 70 years ago, to mine areas that they thought would have run out of Ore 70 years ago.


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