It seems as though we’re reporting almost weekly that one commodity boom or another is finished. In fact, actual commodity price volatility may not be as volatile as commodity prognostication volatility.
Nevertheless, here’s the latest installment.
ANZ global head of commodities research Mark Pervan told Australian Mining that “the good phase for low-cost companies BHP Billiton, Rio Tinto and Brazil’s Vale have [sic] finished.”
He went on to say, “We have seen a decline in steel prices in China and that is dragging down iron ore prices…even at $US110 to $US120 a tonne there’s little incentive for expanding iron ore production.” The article cited that Citi “believes large miners should behave in an ‘oligopolistic’ manner by holding back supply when demand is down, instead of selling it on the spot market.”
Current Steel, Iron Ore and Raw Material Prices:
Rising 4.0 percent to close at $130.00 per metric ton, the cash price of steel billet experienced the biggest change on the LME for Friday, May 31. Also on the LME, the 3-month price of steel billet held steady around $150.00 per metric ton.
For the fifth consecutive day, the US HRC futures contract 3-month price held flat at $600.00 per short ton. The US HRC futures contract spot price remained essentially flat at $578.00 per short ton.