sp is below cash backing, page-12

Interesting comment I saw today.

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The Brazilian Vale group wants BHP to cut its production so as to keep the iron ore price high. But BHP is canvassing the idea of keeping up production and selling the ore the Chinese can't buy on the spot market. That will devastate the spot price and then the long term price. The Brazilians say this is not all that smart. But BHP has in front of it the European Commission preliminary reports on the Rio Tinto merger. Everything they do will have an eye on promoting that merger and to answer its European Commission critics. How much ore BHP sells on the spot market versus the level of production cuts is a decision that will be made in the best interests of the company, but also at the back of their minds will be how it affects the Rio Tinto merger prospects and the Commission. In addition, a key part of the Rio Tinto defence was based on iron ore. These factors will weigh on progress of the proposed merger, though, of course, I can't forecast the outcome of the BHP decision making process.