who shorted this stock ?, page-34

Here's some analysts who obviously have a different opinion to Oscar:

http://www.theaustralian.news.com.au/business/story/0,28124,25635188-643,00.html

ANALYSTS are predicting iron ore prices will rebound by more that 10 per cent next year as Chinese infrastructure investment picks up, shifting negotiating power to the suppliers.

Goldman Sachs JBWere and Credit Suisse have raised their price forecasts for iron ore contract and spot prices over the next 12 to 18 months, with the former claiming the rebound could be stronger if steel production outside China recovered sooner than expected.

In a note to clients on June 11, Goldman Sachs analyst Malcolm Southwood said Australia, which was the lowest cost, high-quality supplier of iron ore, was well-positioned to gain share in the Chinese market.

BHP Billiton and Rio Tinto, which are among the top three iron ore producers in the world and have announced a plan to combine their Western Australian iron ore assets, are the obvious beneficiaries, along with emerging producer Fortescue Metals Group.

Mr Southwood said recent data from Port Hedland suggested that China was on track to import more than 25 million tonnes of Australian ore this month.

"After conceding contract price cuts in 2009 ranging from 28 per cent to 48 per cent ... we believe the balance of pricing power will shift back in favour of the suppliers in 2010 and we have raised our benchmark price forecast for Australian iron ore fines to (plus) 10 per cent," he said.

The bullish forecasts come as signs emerge that the Chinese government's $US770bn ($951bn) stimulus policy is starting to work. The country's investment in fixed assets -- such as roads and power plants -- grew 32.9 per cent in the first five months of the year -- the largest increase recorded for five years.

Iron ore prices have fallen this year for the first time in seven years as construction in China eased and traditional iron ore markets including Japan, South Korea and Europe were hit by the global financial crisis.

China's steel mills are the only major buyers of iron ore that have yet to agree to this year's benchmark price and have threatened to walk away from negotiations if BHP Billiton and Rio Tinto do not accept steep price cuts.

Noting that Brazil's Vale had concluded iron ore and pellet price negotiations with Nippon Steel and Pohang Iron and Steel Company in South Korea, Credit Suisse has reviewed its 2010 and 2011 price forecasts for iron ore fines.

The broker expects fines prices to rise 5 per cent in 2011.

In its report, titled "What goes up must come down", Credit Suisse also predicts spot iron ore prices will improve on the back of stronger demand from markets outside China.

CommSec has yet to revise its own numbers -- it currently forecasts prices will fall 10 per cent -- but commodities analyst Lachlan Shaw said they were constantly under review.

"It's certainly fair to say that the market looks to be tightening up a little in favour of the suppliers," Mr Shaw said. "The strengthening in China in terms of imports and steel production has probably surprised a number in the market."

He said any impact on BHP's and Rio's earnings would depend on whether the Australian dollar appreciated. Both companies are paid US dollars for iron ore, but export value is recorded in Australian currency.

"In general terms, a higher price for iron ore is a good thing for both BHP and Rio," Mr Shaw said.

Australia was the top iron ore exporting country in 2007 and last year, and any improvements in production levels and miners' earnings are expected to have positive flow-on effects for national economic growth.