China steel stockpiles a worrying sign

Original article by Simon Evans, Peter Ker
The Australian Financial Review – Page: 16 : 3-Mar-20

There are reports of growing stockpiles of steel in China, which accounts for around half of the world’s production. Stockpiles have increased because construction companies and other steel users in China have been in partial shutdown due to the coronavirus, and the growing stockpiles have sparked concern of a knock-on effect to Australian iron ore miners such as Fortescue Metals Group and BHP. However, Fortescue CEO Elizabeth Gaines says the coronavirus has not impacted on its shipping schedule at this stage, while she notes that Chinese steel mills are still operating.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, BHP GROUP LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, BLUESCOPE STEEL LIMITED – ASX BSL

Ports beef up virus protections

Original article by Peter Ker
The Australian Financial Review – Page: 10 : 6-Feb-20

Australia’s iron ore and coal shipments may face delays due to the coronavirus outbreak. Ports have been advised to prevent Chinese vessels from docking unless they have been at sea for at least 14 days. However, the sailing time between China and Australia’s largest ports can be as little as 10 days. The impact of the virus on exporters has been limited to date, as the outbreak has coincided with the Lunar New Year holiday period. Meanwhile, the Health Department has ordered marine pilots to wear surgical masks and gloves when they board vessels that have come from China.

CORPORATES
AUSTRALIA. DEPT OF HEALTH

Share surge elevates Forrest to $13bn man

Original article by John Stensholt
The Australian – Page: 15 & 16 : 21-Jan-20

Shares in pure-play iron ore miner Fortescue Metals Group have gained more than 10 per cent so far in 2020, reaching a new intra-day high of $11.92 on 20 January. The rally has lifted Fortescue’s market capitalisation to more than $36bn, and it now ranks as Australia’s 13th largest company in terms of market cap. The stake of founder Andrew Forrest is now worth about $13bn, while his net wealth has increased by about $1bn since the start of the year and $7bn since March.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG

Iron’s endless summer keeps on keeping on

Original article by Peter Ker
The Australian Financial Review – Page: 43 : 21-Dec-19

Shares in Fortescue Metals Group are trading at an 11-year high, boosted by factors such as continued strong demand for iron ore in China and supply disruptions in Brazil. Meanwhile, Rio Tinto’s shares have regularly traded above $100 in 2019, and the stock has not fallen below $35 in the last decade. Demand for iron ore has defied expectations over the last 10 years. The price of the steel input peaked at almost $US190 per tonne in 2011; its fall to around $US80/tonne in subsequent years prompted some observers to forecast that the iron ore boom was over. However, Australia’s iron ore exports reached a record $77bn in 2018-19 and could top $81bn in 2019-20. Likewise, some experts forecast that China’s annual steel production will exceed one million tonnes for the first time in 2020.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, RIO TINTO LIMITED – ASX RIO, BHP GROUP LIMITED – ASX BHP, VALE SA

Andrew Forrest’s $500m payday as iron ore rallies

Original article by Julie-anne Sprague
The Australian Financial Review – Page: 29 : 12-Dec-19

Shares in Fortescue Metals Group closed $0.14 higher at $10.38 on 11 December, after peaking at a record $10.45. The pure-play iron ore miner’s shares have gained nearly 150 per cent in the year to date; the rally has seen the stake of founder Andrew Forrest rise to around $11.3bn, with the iron ore price trading at around $US93 per tonne. BHP’s share price is currently trading at its highest level since August, while Rio Tinto is trading at a four-month high.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, BHP GROUP LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO

China has other options for its iron ore

Original article by Nick Evans
The Australian – Page: 17 & 20 : 11-Oct-19

Fortescue Metals Group CEO Elizabeth Gaines has stressed the importance of Australia’s trading relationship with China. She has told the in a Melbourne Mining Club that commodities exports to China have been a key contributor to Australia’s economic growth, and warned that China will seek other sources of iron ore if relations between the two nations deteriorates. Gaines noted that Ernst & Young has estimated that iron ore accounted for three per cent of Australia’s GDP in 2018-19.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, THE MELBOURNE MINING CLUB, RIO TINTO LIMITED – ASX RIO, ALUMINIUM CORPORATION OF CHINA LIMITED

Iron ore forecasts tumble, resources giants downgraded

Original article by Robert Guy
The Australian Financial Review – Page: 32 : 2-Oct-19

Credit Suisse has scaled back its benchmark iron ore price forecasts for the next three years, due to expectations that Chinese steel production will peak in 2019. The firm now expects iron ore to fetch $US80 a tonne in 2020, which is six per cent lower than its previous guidance. Its price forecast for 2021 has been cut by 13 per cent to $US65/tonne, while the iron ore price is now expected to average $US60 a tonne in 2022. Credit Suisse has also reduced its share price targets for BHP, Rio Tinto and Fortescue Metals Group, while its rating on the latter has been downgraded from ‘neutral’ to ‘underperform’.

CORPORATES
CREDIT SUISSE (AUSTRALIA) LIMITED, BHP GROUP LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, FORTESCUE METALS GROUP LIMITED – ASX FMG, UBS HOLDINGS PTY LTD

Rio Tinto teams with China to cut emissions

Original article by Brad Thompson
The Australian Financial Review – Page: 15 & 20 : 26-Sep-19

Rio Tinto has signed a memorandum of understanding with China Baowu Steel Group and Tsinghua University to develop strategies aimed at reducing carbon emissions across the steel industry. Steel-making accounts for the bulk of Rio Tinto’s scope 3 emissions, which totalled 536 million tonnes of carbon dioxide equivalent gases in 2018. In contrast, its scope 1 and 2 emissions totalled 28.6 million tonnes. BHP also recently revealed plans to address its scope 3 emissions.

CORPORATES
RIO TINTO LIMITED – ASX RIO, CHINA BAOWU STEEL GROUP CORPORATION LIMITED, TSINGHUA UNIVERSITY, BHP GROUP LIMITED – ASX BHP, FORTESCUE METALS GROUP LIMITED – ASX FMG, MARKET FORCES, FRIENDS OF THE EARTH

Iron ore outlook not so bleak: analysts

Original article by Al Root
The Australian – Page: Online : 15-Aug-19

Goldman Sachs analyst Paul Young has upgraded his rating for Fortescue Metals from ‘hold’ to ‘buy’, despite the recent slump in the price of iron ore. Young has also set a price target of $9.80 for Fortescue, around 35 per cent higher than recent levels. Although JP Morgan has noted recently that Vale is producing more ore and Chinese steel inventories are on the increase, Young notes that Goldman’s commodities team has recently upgraded 2019, 2020 and 20201 estimated iron ore prices.

CORPORATES
GOLDMAN SACHS AUSTRALIA PTY LTD, FORTESCUE METALS GROUP LIMITED – ASX FMG, VALE SA, JP MORGAN AUSTRALIA LIMITED, CORONADO GLOBAL RESOURCES INCORPORATED – ASX CRN

Bullish iron ore could give budget $4b boost

Original article by Peter Ker
The Australian Financial Review – Page: 19 : 29-May-19

The iron ore price reached a five-year high of $US108 per tonne on 28 May, prompting strong gains in the share prices of Australia’s three major producers. The federal government’s April 2019 Budget had forecast that the iron ore price would average $US88/tonne in 2019-20; Nicki Hutley of Deloitte Access Economics says government revenue could increase by $4bn if the price remains at its current level over this period. Goldman Sachs does not expect iron ore to remain above $US100 for long; it has issued a revised price forecast for 2019 of $US91.

CORPORATES
BHP GROUP LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, FORTESCUE METALS GROUP LIMITED – ASX FMG, VALE SA, DELOITTE ACCESS ECONOMICS PTY LTD, GOLDMAN SACHS AUSTRALIA PTY LTD, MOUNT GIBSON IRON LIMITED – ASX MGX, ROY HILL HOLDINGS PTY LTD, MINERAL RESOURCES LIMITED – ASX MIN, GRANGE RESOURCES LIMITED – ASX GRR