The hottest iron ore plummeted, and the market dow

2022-08-24
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The collapse of iron ore market is difficult to change. International giants have reduced capital without reducing production. Since this year, due to the large global supply of iron ore, the term shoelace has actually increased by a large margin, and the price of iron ore has plummeted all the way. Mining companies cut capital but not production. Since the beginning of this year, due to the substantial growth of global iron ore supply, the price of iron ore has plummeted all the way. As of December 3, the price of 62% iron ore in Qingdao port has fallen to 69.5 dollars/ton. Industry insiders said that in addition to the growth of global supply and oversupply, the decline in steel production was also a major reason for the sharp decline in iron ore prices. Iron ore prices fell steadily, but the world's major mining companies were still increasing production in the first half of this year, but they all reduced capital expenditure

the decline of the iron ore market is difficult to change

according to the data of the National Bureau of statistics, the cumulative output of crude steel in China from January to September this year was 61.985 million tons, a year-on-year decrease of 1.4%. Among them, the crude steel output in October was 59.6 million tons, a year-on-year decrease of 6.2%; In mid November, the daily output of crude steel in China was 1.6421 million tons, with a month on month increase of 0.44%. According to the data of China Steel Association, the average daily output of crude steel in the first ten days of November this year was 2.072 million tons, a month on month decrease of 16.36%. Due to the impact of the APEC meeting, Hebei Province has significantly reduced production, and the operating rate fell by about 25% in the first ten days of November, resulting in a sharp decline in crude steel production

although the terminal demand has weakened, the production reduction of upstream steel mills is still not obvious. Under the condition that the profitability of most steel mills is still good, the production enthusiasm of steel mills is on the high side. Especially at present, the construction steel resources such as thread screw are seriously out of stock, and the major steel mills are fully engaged in production. Therefore, the phenomenon of low inventory in the spot market is difficult to continue, and the supply pressure in the off-season remains

from the perspective of market demand, according to the report released by China Steel Association, affected by seasonal factors, the temperature in the North has dropped sharply, and the market demand will gradually stagnate. The initial value of HSBC PMI in November is only 50%, and the continuous decline indicates that the previous production restriction is accelerating the weakening of the manufacturing industry economy, with great downward pressure, which will continue to restrict the release of steel demand in the later period

from the perspective of the raw material market, CISA said that at present, the bearish sentiment in the imported ore market is also widespread. Recently, the main contracts of iron ore futures first fell by the limit, followed by a wave of sharp falls, repeatedly hitting new lows, and the spot price of the port also continued to fall

a few days ago, Citibank said in a report that in 2015, the market supply will increase again and the demand will weaken further, which will push down the iron ore price again. At that time, the iron ore price will fall to $50 - $60/ton

mining companies: reduce capital without reducing production

although the price of iron ore fell rapidly this year, the major international mining companies have not shown any signs of production reduction at present, and most of them continue to increase production capacity according to the original plan. For example, Vale plans to increase its production from 306 million tons last year to 450 million tons by 2018, Rio Tinto plans to increase its production from 266 million tons last year to 360 million tons by 2016, and BHP Billiton plans to increase its production from 225 million tons last year to 290 million tons in 2017. Industry insiders believe that the main reason why the mining giant can adhere to the expansion of production is that it still has considerable profits by virtue of its low-cost participation in lubricants between friction surfaces in various metal materials, steel cables, chains, lifting belts, commonly used metal products, building structures, ships, ordnance and other fields, while the price of iron ore has fallen, They compensate by crowding out the market share of other competitors

although the sensors of bhe electronic universal experimental machine are not easy to damage, Andrew Mackenzie, CEO of BHP, said in an interview recently that once the enterprise has production capacity, if it stops production, the unit production cost will rise. BHP Billiton hopes to maximize production on the basis of existing capacity. FMG, the world's fourth largest iron ore producer, also announced recently that it plans to maintain its production target for fiscal 2015, with shipments of 155-160 million tons, hoping to maximize production through FMG's existing mines and infrastructure

however, in the face of falling iron ore prices, mining giants are not indifferent, but coincidentally adopted the way of reducing capital expenditure. Rio Tinto, the world's second-largest iron ore producer, has decided to postpone its plan to spend $1billion to build an iron ore mine in Australia, but said it still expected to reach a production expansion target of 350million tons by 2017. FMG plans to reduce the capital expenditure of US $1.3 billion to US $650million in fiscal 2015 by redesigning the dehydration needs, improving the higher construction efficiency of Anderson berth 5, reducing exploration, reducing and delaying operating capital expenditure, etc

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