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    September 14, 2020

    Iron Ore: Soaring And Roaring

    Commodities, Iron Ore Analysis

    By Angelique Thakur | FN Arena

    The rebound in China’s steel demand, considerably faster than expected, has left Macquarie analysts surprised. But that’s not all. Citi economists expect China to set a growth target of 5.5% in its 14th five-year plan. Admittedly, it is less than the 6.5% rate of growth aimed for by China in its 13th five-year plan. But, as Citi points out, indicates moderation as opposed to collapse of growth as was feared.

    China has also indicated this growth will mostly be led by its domestic market. But what pleases Citi is the how of it. It looks like China will be focusing on developing its infrastructure. In particular, steel-intensive sectors like infrastructure, property, and automotive will be the key pillars for China’s economic growth.

    This leads Citi analysts to expect steel end-use demand to increase by 1-2% (year on year) per annum during 2021-23 versus the -1% decline that was forecast earlier.

    There’s more. Macquarie points towards a steel demand recovery in the US, EU and Indian markets. According to Macquarie, the three catalysts for iron ore and steel include a continued recovery in the auto sector, stimulus by countries like China (focused on infrastructure development) and new proposed construction guidelines in China that could boost steel intensity in buildings (although there is no firm timeline for this)…Full Story

    China’s sliding coal imports weakens one of the last bullish supports: Russell China’s Clean Energy Pivot Could Be The Death Knell For Coal

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