Iron Ore Price Leaps Clear Of $US50 A Tonne
23 June 2016
The iron ore price has jumped out of its steady trading range as analysts took a glass half-full attitude to the release of industry data.
Iron ore rose 2 per cent to $US51.70 overnight, according to The Steel Index. Over each the previous five sessions, the commodity had settled in a range between $US50.20 and $US50.80.
Data showed global crude steel production fell 0.1 per cent in May, compared to the previous year, but Macquarie analysts looked for the bright side.
“While this does mark the 17th consecutive month of year-on-year contraction, when compared with -6.9 per cent year on year in January, the recovery has been decent,” Macquarie said in a note.
Elsewhere, May data showed China’s iron ore imports rose to 86.8 million tonnes, a 3 per cent rise from the prior month and an increase of 22 per cent from a year earlier, UBS analysts said.
“Steel exports year to date are +6 per cent year-on-year, pointing to only limited anti-dumping impacts to date,” UBS wrote.
The commodity has proved surprisingly resilient over recent months as Chinese steel mills embarked on a process of restocking, but it is still holding below somewhat optimistic federal Budget forecasts of $US55 a tonne.
In London trade, BHP Billiton shares rose 0.7 per cent, while Rio Tinto added 1.8 per cent.
Source : theaustralian.com.au