Qingdao iron ore fell 1.3% to $93.62 yesterday.
SHFE futures were pulverised and SGX caught down:
Mad Dalian was also bad:
Coking coal will halve yet!
Baowu Group summed it all up better than I could:
Conditions in China’s steel sector are like a “harsh winter” that will be “longer, colder and more difficult to endure than we expected,” China Baowu Steel Group Corp. chairman Hu Wangming told staff at the company’s half-year meeting, warning of a worse challenge than major traumas in 2008 and 2015.
…“Financial departments at all levels should pay more attention to the security of the company’s funding,” a Baowu statement said, with a need to strengthen controls, including for overdue payments and detecting fake trades. “In the process of crossing the long and harsh winter, cash is more important than profit.”
Yep. Chinese property is busted. Stimulus is finished. Pig iron will be substituted with recycling. Steel exports will be choked off by tariffs. Those can only be repaired via lower input costs.
Citi shows the trend that matters. Pig iron output falls from here to eternity:
Place your head firmly between your legs…
