There are forecasts of Copper at $1USD/lb early next year. This means that RIO would make no profit at all from Copper and probably a loss. Add continuing falls in all other base metals and the picture looks bleak.
Iron Ore & Coal are RIO's best hope but who knows how much these will fall when contracts are renegotiated. Steel makers everywhere are reducing production as stockpiles rise. Energy coal is about the only positive but this wont save RIO.
Too bad they believed their own hype that the commodity supercycle would last for 20 years. They went out and borrowed big to purchase assets at the very top of the cycle and now they are in trouble.
RIO Price at posting:
$24.50 Sentiment: None Disclosure: Not Held
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