As per AGOs latest announcements and presentations CD has a C1...

As per AGOs latest announcements and presentations CD has a C1 cost of between 37-43 AUD per Mt.. they also state that they are working on a number of things to make sure that it's at the lower end of that range.. that would mean its cost curve is very similar to existing production by AGO which had full cash costs (not C1) of $52-54 AUD - breakeven USD IO price therefore
Between $38 and $40 USD for 58% based on 0.7300 AUD/USD

What a number of you don't realise is that in the last quarter AGOs hedging was via IO swaps over the 62% benchmark price. So when the margin between 58 and 62 widened AGO was stuck cash settling their swaps off the 62 price whilst receiving the 58 price for their product - this is called basis risk and is something one must consider in hedging - especially when your hedge does not move 1 to 1 with your underlying commodity.

I think/hope that the reform in Chinese Steel Production will be Positive for global Steel Prices and based on the previous historical relationship positive IO prices. I also tend to agree with ASXDude and feel analysts are too quick to discount global demand ex-China - can other EM make up the difference? Or are we relying on Chinese steel production to ramp up over their summer when they have free reign - remember in November we will move into their newly proposed production slow down..

Time will tell. GLTAH