iShares MSCI Glbl Metals & Mining Prdcrs

Rio Tinto’s (RIO) net debt at the end of 1H17 was $7.6 billion, compared with $12.9 billion at the end of 1H16 and $9.6 billion at the end of December 2016.

BHP’s net debt was $20.1 billion at the end of December 2016, as compared to $26.1 billion on June 30, 2016.

China imported 92 million tons of iron ore in January 2017—a growth of 12.0% YoY and 3.4% month-over-month.

Iron ore makes up 38% of BHP Billiton’s (BHP) revenues and 42% of its EBITDA.

While Vale SA outperformed peers including Rio Tinto (RIO) and BHP Billiton by rising 24.7% in 1Q17, its performance deteriorated significantly in 2Q17.

Iron ore price realization In 4Q16, Vale’s (VALE) ferrous division accounted for ~85.0% of its adjusted EBITDA (earnings before interest, tax, depreciation, and amortization). The company’s EBITDA for ferrous minerals came in at $4.1 billion, which was $1.6 billion higher than 3Q16. Higher realized prices and higher sales volumes led to these rises. The CFR […]

Contrary to what was suggested by many market participants, the iron ore imports by China increased in September 2016 instead of declining.

Overall, BHP reported mixed 2Q15 results. It recorded a 9% production increase during the December 2014 half-year.

As per the FOMC staff report, inflation (TIP) in the US remained below the 2% target.

Capacity utilization and the US economy Among the key macroeconomic indicators published by the Federal Reserve, US industries’ capacity utilization is particularly important for understanding the health of each industry. Changes to this indicator can help forecast any changes to the business cycle, product demand, and workforce demand. Increasing levels of capacity utilization could translate to a higher number […]

Iron ore (PICK) volumes are key to BHP Billiton’s (BHP) revenues and earnings as iron ore is the single largest commodity produced by the company.

Iron ore prices have been very volatile lately. While the prices fell substantially in September 2017, they picked up after that.

China’s property sector is a steel-intensive market—consuming approximately 50% of overall steel in the country—followed by the automotive industry.

Due to the government’s efforts to fight pollution in winter months, steel prices in China have hit a nine-year high in the first week of December 2017.

Overall, China’s steel production in 2017 was strong, which was mostly supported by higher steel prices and firm demand.

Goldman Sachs (GS) believes that iron ore prices should sink back to $50 per ton in 2018.

Iron ore prices were tumultuous throughout 2017. There is a 44% difference between the peak of $95 per ton in February and the trough of $53 per ton experienced in July.

In the November capacity utilization report, the manufacturing sector remained strong with 76.4% capacity utilization, the highest level since May 2008.

The Federal Reserve released its November industrial production report on December 15, 2017. The report indicated that industrial production improved 0.2% in November.

Vale has changed its product portfolio and quality in iron ore according to market demand. In 2017, it’s more focused on selling high-quality ore.

In the previous part of this series, we discussed how the momentum in Chinese steel production in 2017 has come on the back of strong steel prices.

Iron ore prices in 2017 so far have been a roller coaster ride. Prices reached a peak of $95 per ton in February only to slump to a low of $53 per ton in July and take off soon after.

The October Industrial Production report was released by the Fed on November 16 and showed a continued rebound in key sectors of the US economy.

Vale’s (VALE) Ferrous division accounted for ~87.6% of its adjusted EBITDA in 3Q17, compared with ~82.0% in 2Q17.

The Federal Reserve released its September industrial production report on October 17. The report indicated that key sectors in the US economy increased production in September.

China is the world’s largest consumer of iron ore. Therefore, to gauge the outlook for iron ore demand, it’s important to track China’s iron ore import data.

According to Reuters, the September 2017 steel rebar futures contract on the Shanghai Futures Exchange has risen 40% year-to-date.

China’s iron ore imports for July 2017 fell 2.4% over July 2016 to 86.3 million tons.

Goldman Sachs is bullish Although Goldman Sachs (GS) is bullish on the near-term price forecasts for iron ore, it believes that the pressure could return in the long run. In the near term, it believes that prices could be supported by the better-than-expected demand in China.  Goldman Sachs believes that the supply pressure could build […]

BHP Billiton (BHP) attributed the rise in iron ore prices to higher pig iron production in China, the preference for higher grade materials, and improved steel margins.

Led by its superior assets, location, and geological advantages, Compass Minerals holds a competitive position with a wide economic moat rating.

Vale’s (VALE) ferrous division accounted for ~82%.0% of its adjusted EBITDA (earnings before interest, tax, depreciation, and amortization) in 2Q17.

Chinese steel production has been hitting one record after another. This renewed vigor in the Chinese steel industry is due to higher steel prices.

It’s important for investors to keep track of China’s iron ore import data because they provide a clue regarding the demand patterns for imported iron ore among Chinese mills and traders.

While iron ore prices have rebounded recently, analysts are still skeptical about the long term. Morgan Stanley has reduced its iron ore price forecast for 3Q17 by 23% to $50 per ton.

Based on its June 12, 2017, closing price, Cliffs Natural Resources is trading 15.2% and 11.9% higher than its 50-day and 20-day moving averages, respectively.

One of the major factors that led to the iron ore price rally in 2016 and 1Q17 was stronger-than-expected Chinese steel prices.

China’s iron ore imports recovered from a six-month low in April by importing 91.5 million tons in May 2017.

The estimated investment needed for Cliffs Natural Resources’ (CLF) HBI (hot briquetted iron) plant is ~$700 million.

In 1Q17, Vale’s (VALE) ferrous division accounted for ~89.0% of its adjusted EBITDA (earnings before interest, tax, depreciation, and amortization).

In 1Q17, Vale (VALE) significantly outperformed its major peers with a rise of ~25%.

Strong Chinese iron ore imports China imported 95.6 million tons of iron ore in March, compared with 83.5 million tons in February 2017. This figure implies a strong growth of 11% year-over-year (or YoY). This number is also the second-highest monthly amount on record. China imported 96.3 million tons of iron ore in December 2015. […]

Among the iron ore miners (PICK), analysts are most bullish on Rio Tinto (RIO), with 63% “buy” and 19% “hold” ratings.

China imported a total of 83.5 million tons of iron ore in February 2017, which represents a growth of 13% YoY (year-over-year) and -9.2% month-over-month.

China’s iron ore imports were robust in 2016. While the country’s imports fell 7.6% year-over-year (or YoY) in December 2016, they hit a yearly record in 2016.

ROK maintains that oil prices have recovered since early 2016 and that most of its business in the heavy industries end market is expected to stabilize.

Contrary to what’s been suggested by many market participants, China’s iron ore imports have been robust in 2016. In November, imports were 92.0 million tons.

China’s weaker iron ore imports Contrary to what’s been suggested by many market participants, China’s iron ore imports have been robust in 2016. In October, however, the imports were at their lowest since February, at 80.8 million tons, down 13% month-over-month. On a year-over-year basis, the imports rose 7%. In the first ten months of […]

Jacobs Engineering Group declared its 4Q16 and fiscal 2016 results on November 22. It reported adjusted EPS (earnings per share) of $0.77.

Rockwell Automation maintains that oil prices have recovered since the beginning of 2016, and most of its business in the heavy industries end market is expected to stabilize.