Iron ore, corona virus and next economic phase, page-2

Might want to look at those stats. The Aussie and iron ore didn’t peak in 2006, it was 2010/2011 and that’s when the Aussie was $1.10 to 1 USD with iron ore close to $200 USD. 2006 the China story was only really starting. Oil is different, it’s OPEC, Corona has had an effect but it’s drop is mainly the OPEC was with the US. Sending US shale bankrupt.

Iron ore has nothing to really do with manufacturing. It’s China’s internal construction bringing their population out of third world mud huts. It’s urbanisation effectively. Japan went through this before, albeit much smaller population.

China is recovering from the Coronavirus and it’s steel mills only shut down for the holiday as they always do, so now restocking. I’d argue extra stimulus from China internally for building bridges and infrastructure will see iron ore hold to a degree. Unless corona kills a huge % of Chinese and they no longer urbanise, then yes iron ore would crash. Thankfully the big miners balance sheets are impeccable to withstand a temp shutdown, they also held back recent dividends as this pandemic took off. Smart move.

The miners are currently the saving grace of Australia, just like the GFC. I hope it’s a wake up call to lunatic militant greens/far left labor that without mining we are $&@“ed. Maybe the climate change cultists might get a grip of reality too.