market is panicing nothing more nothing less.
growth downgrades in the order of 2% or even 4% for the emerging economics certainly provide reason for optimism to be capped but the prices which are emerging are pricing in complete armegedon. Who is the first place China import from? Australia. The last iron ore to be no longer purchased from the market is ours! A down turn could actually increase Australia's market share.
In fact it's been increasing. July and August were ALL TIME records for imports of iron ore from Australia to China in a month.
imo talk of demand disappearing is ridiculous. Steel mills not being able to organise a payment ( and we are talking $millions of dollars here) is not surprising given the credit environment. They are not cancelling the shipments.
UMC at these levels and MGX for that matter in the 80c range are not fair value on fundementals. Sure if you buy today you might even be out of the money next week but 6mths from now do you really think so?
market is panicing nothing more nothing less.growth downgrades...
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