Iron ore price, page-23679

that’s a top post JHunt.

It’s rather ironic that the one event that initially adversely affected FMG’s share price was the catalyst and driver for the position of strength the company finds itself in now.

When Wuhan was locked down in late Jan, it was FMG that was shrouded in most uncertainty.

But everything else has fallen FMG’s way since then.

That same weekend southern Brazil were hit with record rainfalls. They were hit just as hard a couple of weeks later.

the Wuhan lockdown occurred at a time when final demand was negligible in any case ie CNY

Steel production was still high as blast furnaces couldn’t be shut down. What this meant was high steel inventory and low rebar prices. EAF usage has plummeted a week ago before CNY given negative margins. The pressure on rebar prices kept scrap usage near zero for nearly 2 months. This resulted in higher iron ore usage during this time.

cyclone in Pilbara was brutal and once again it wasn’t FMG who fared worst

Despite iron ore prices being robust in March, the AUD was sold off aggressively and oil prices collapsed, both benefiting FMG

China at this point had effectively eliminated covid. Bolsanaro was denying it was ever such a thing just as it started to take hold in Brazil

secondary players such as India, South Africa, Canada and Minnesota hit hard by covid.

end of iron ore leases in India affecting production

seismic event in Sweden resulted in worlds largest underground iron ore mine going offline (Lkab)

Blast furnace capacity utilisation rates in China hitting all time highs. It’s unlikely China would have adopted such aggressive expansionary policies had they not experienced negative GDP in first quarter and/or the rest of the world was down and out due to covid

as you’ve mentioned, fmg now seen as a dividend machine. The world has been turned upside down

steel production slowly on the mend worldwide but still way off compared to pre covid. Lots of stimulus worldwide, some will surely find its way into infrastructure.


Cheers