Commodities

Decent output levels are keeping iron ore supported for now. There’s nothing good happening property. Compared to December, China’s on-budget fiscal revenue and off-budget land sales revenue both weakened meaningfully in January-February, more significant than the deceleration in government spending growth. Our proprietary “augmented fiscal deficit” (AFD) metric widened slightly in February vs.

The ferrous jaws are back.

The great coal crash continues.

The iron ore jaws are wide.

The jaws are getting stupid as steel prices are in free fall.

Steel prices are in free fall as tariffs mount.

The latest sales data is flatlined.

So much for the ferrous rally.

Sense never lasts long in the iron ore market.

I have long argued that RIO’s treasonous Simandou mine is the Pilbara and QLD killer via crashing iron roe and coking prices.

For a while there it was almost as of iron ore might turn rational and close its jaws with steel prices.

China is in the flush of one last steel export surge, up 6.7% year on year for Jan/Feb.

The iron ore jaws remain wide.

Iron ore was clubbed below $100 yesterday but bounced a bit overnight.

It had to happen.

The ferrous complex has begun to deflate post-supply disruption.

The ferrous complex has come off a little but it is still enjoying favorable Q1 dynamics.

The ferrous complex rolled over yesterday.

Something I have not much focused on is the implications of the Guinean Pilbara killer mine on QLD. Simandou produces such high-quality iron ore that it can and will be used as direct injection feedstock into electric-arc furnaces (EAF).

Both steel and iron ore fell yesterday.

The ferrous complex is still in the throws of LNY distortions and Q1 supply disruptions, supporting prices.

The Aussie terms of trade shellacking is taking a breather, but the trend is intact and will get much worse.

It’s always the same at this stage of the cycle, only this time it is secular, not cyclical.

So much for the Cat5 monster.

Thar she blows.