Now that the Chinese have been caught down-ramping the economy
by over 3.5% and given that up to last June the Chinese import of iron ore was
up by 16% YOY, it is reasonable to conclude that the Chinese have been sandbagging
to push down prices.
Perhaps the big IO producers will wake up and moderate production to meet
short term demand. China drew a line in the sand 4 years ago when it jailed
Rio executives for gathering Chinese market intelligence on prospective
Chinese demand so there is apt to be apprehension about any current market
intelligence gathering in China.
The answer is simple; just turn down the tap until the price goes up
and the shareholders of Rio, Vale, BHP & FMG should be demanding that.
