Send it up and down as they wish !
How come market cap is only 2.7B ? hugely undervalued as Casablanca mentioned.
Liquidation of iron ore stocks used in financial deals in China have pushed the metal's price to an 18-month low, analysts say.
Fears of a slowdown in Chinese economic growth continue to bubble to the surface, with the price of iron ore, Australia's most valuable commodity, plunging to an 18-month low. But there are other factors at play that have contributed to the plummeting price.
In its biggest one-day loss in more than four years, iron ore slumped 8.3 per cent, or $US9.50, to $US104.70 per tonne, its lowest since October 5, 2012.
General consensus for the slump in the metal's price point towards slower economic growth in China, but while it is a factor in the overall decline, there are other wheels in motion that contributed to the sharp fall overnight.
The sharp moves are caused by deleveraging to the extent that iron ore has been collateral for financing arrangements, said Deltec chief investment officer Atul Lele.
When collateral holders sell it drives the price down, forcing others to get rid of their holdings.
“Financing deals being unwound due to lower iron ore prices are driving lower iron ore prices, which is driving collateral values lower and necessitating further financing deals having to be unwound. Iron Ore prices don’t fall 8.3 per cent in one day due to slower Chinese growth. They fall because of a credit event,” Mr Lele said.
Given where iron ore prices are and where Chinese inventories levels are, there would need to be a very large increase in steel production to justify an increase in steel production growth to then justify a drawdown in the inventory levels, Mr Lele said.
Iron ore stocks in China also showed another rise in the last week, increasing 5 million tonnes to 99.3 million tonnes, the highest level for this time of the year since the series started in 2006, ANZ head of commodities Mark Pervan said.
"The other potential catalyst centres on credit worries in the steel sector in China, with reports of the pote
March 11, 2014 6:03PM
MINING giant BHP Billiton says it's in good shape to weather steep iron price falls, despite predictions of more pain to come.
Analysts have forecast more falls as the iron ore price fell to $US105 per tonne on Tuesday, with Citi analysts predicting an average price of $US80 in 2016.
Half of BHP's earnings came from iron ore, but its president of iron ore Jimmy Wilson said the miner was diversified enough to handle price fluctuations and maintain its forecasts.
"We'll certainly survive this," Mr Wilson told reporters on the sidelines of an iron ore conference in Perth.
Despite a weak outlook for the steel making ingredient, the world's largest mining company is still targeting iron ore production of 212 million tonnes per annum in the 2013/14 financial year.
Market watchers have attributed the iron ore price fall to a credit squeeze in China and high iron ore stocks.
But Mr Wilson does not see the current dip as a down cycle amid fluctuations in the market.
"The iron ore price we see going down," he said.
"The magnitude of that number... $US80 per tonne feels a little low.
"We don't make forecasts like that."
He said the price falls would rebound and steady out.
"Our view is the long-term is still very robust," Mr Wilson said.
"We shouldn't let today's price influence our long-term thinking."
But he conceded the company's iron ore division had limited protection if Chinese buyers stopped paying for iron ore shipments. BHP protects itself by asking for letters of credit.
"We have assurances around each of the cargoes. We're reasonably protected," Mr Wilson said.
In the past BHP Billiton's customers in Japan and China had continued to pay their bills, with very few defaults, he said.
Lower prices would probably affect BHP much less than some of its peers in Western Australia, he added.
And this year's global supply of iron ore would exceed demand, Mr Wilson said.
BHP plans to expand its future iron ore output in the Pilbara
Are they on Casablanca side or not ? Small shareholders need to know and have right for an annual meeting. They cannot let us without any news or feedback when stock is dropping 4% daily.
To push Casablanca to act.
Could Casablanca bring them on their side ? Small shareholders have the right to know what is happening and have the right to have a shareholder meeting. Am I correct ?
Does anyone have this Insider info ?
Can you give the source?
Let's voting for Casablanca directors
Vale debt is 29B. CLF has 11B assets and equipment, they can easily cover 3B debt ! What do you think ?
Every day price drop will push for a drastic change. Hold on tight !