"It does not see upside to iron ore demand because mills are already running at high utilisation given currently attractive margins – steel companies have even postponed annual maintenance stoppages."
Other key takeaways included that China's domestic miners are cutting costs to below $US70 a tonne from $US80 a tonne by increasing efficiency, and are also helped by local governments cutting fees and taxes.
The traders said port inventory – which is 60 per cent owned by traders and 40 per cent owned by mills – has slightly retreated from the highest level of 115 million tonnes to 105 million tonnes."
That is one hell of a BS article imo , mills are running at high utilisation means they are using heaps of IO , chinese domestic producers are cutting costs to below US$70 , since when were the chinese costs this low when for the past year every IO company and media article have the chinese with IO costs above US$120 , the port inventory is reducing as mentioned but no reason why , they must be dumping it at sea or using it due to high utilisation at the steel mills and what else in that article was impacting on a lower price temporarily was steel mills having to sell some of their ore at spot to traders to cover roll over of lines of credit or something like that. Steel mills are profitable at these iron ore prices and higher so should have no problem refinancing lines of credit.
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