Iron ore: more producers returning, should cap rally – Westpac
By FXStreet Robert Rennie, Global Head of Market Strategy at Westpac, notes that iron ore exports from ‘other’ producers are rising again, suggesting that it should help to cap iron ore prices.
Key Quotes
“The recent break higher in iron ore prices seems to be stimulating ‘other’ producers to return to market. Exports from Sierra Leone disappeared last year as the Tonkolili mine was closed.”
“It re-commenced operations in February. The Ngwenya iron ore mine in Swaziland looks like it is reopening; Cliff s Natural Resources announced last week that it will be restarting its iron ore pellet production in Minnesota.”
“Last month, the Indian government announced it will drop the 10% export tax on 58% fi nes and abolish the 30% levy on lower-grade lumps.”
“We are beginning to see signs of reemerging producers/ exporters in Africa, India and the Americas-ex Brazil.”
“We expect to see more in coming months. We see this as a factor that should help to cap iron ore prices.”
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Source:: FX Street
