Compelling reward/risk ratio, page-70

In December 2015, iron ore price hit US$39/ton, Goldman Sachs did exactly same warning of more pain for iron ore price, and predicted long term iron ore price of US$34/ton.

The reality is, even iron ore was 250 million tons over supplied as GS suggested, iron ore price was up over 150% to around US$90/t in 2016. Their long term iron ore price of US$34/t was just a joke. Iron ore price hit new record of US$237/t in 2021, now is sitting at US$129/ton.

I firmly believe lithium price will bounce hard early next year after Chinese New Year season in February, as lithium price has already fallen by 75-80% which is the worst case for a commodity cycle. So we are at the bottom.

All imo.
Goldman sees more pain for iron ore
PUBLISHED THU, DEC 17 201512:34 AM ESTUPDATED THU, DEC 17 20152:47 AM EST
Huileng Tan


The iron ore market can’t catch a break. The slowdown in China has already hammered prices by close to 50 percent this year and now Goldman Sachs has slashed its price forecast for the raw material used in steel-making.

The downgrade in price forecasts were made to reflect the need to cut 250 million tons, or 18 percent of current supply, of seaborne mining capacity in the next three years.

Despite closures and planned cuts amounting to 15 million tons a year at producers BC Iron and Kumba Iron Ore, these “were not enough to offset bearish sentiment among steel mills and traders in China, where tight liquidity and depressed profit margins are driving buyers away from the seaborne market,” the analysts added.

“The iron ore sector may have to hibernate for an extended period before alternative steel markets in other regions take over from China and usher in the next bull market,” the analysts wrote, pegging long-term forecast at $34 a ton.