Rise of China’s Xinjiang as coal hub undercuts climate goals
Output has surged 22% this year, the fastest growth of any region in China.
Chart by Bloomberg.
Another ray of sunshine appeared late last week for the iron ore price, which has been climbing in recent days on hopes for a revival of Chinese infrastructure spending.
The Sydney Morning Herald reported on Saturday that the Baltic Dry Index – a measure of shipping costs for commodities – had its biggest two-day gain since 2009, over speculation that Chinese iron ore purchasing will cause a shortage of vessels, thereby increasing freight rates. The London-based index rose 18 percent, with costs for capesize vessels that transport iron ore from Brazil to China, climbing 16 percent.
“There’s a misunderstanding among investors that China isn’t buying iron ore: it is,” Jeffrey Landsberg, the managing director of Commodore Research in New York, told SMH. “China is still buying every single ton that global miners want to sell.”
Shipping costs have been in a slump this year as shipbrokers predict too many vessels chasing too few cargoes due to slowing economic growth in the world’s biggest commodities consumer.
Meanwhile the steelmaking ingredient rose for the second straight day on Monday, with benchmark iron ore for immediate delivery to the port of Tianjin, China trading at US$57.10 a tonne. Iron ore hit a 10-week high on September 10, trading at $58.50 a tonne, 30-percent above record lows for the spot market reached on July 8.
Comments
Brian R. McCaughrin
China is looking for lower Ore prices period. I find it hard to believe by this article saying their is shortage of Cape Size vessel when their is parking lot of them tied up due to glut of over ordering of ships by these same ship owners crying the blues over chartering rates…delivery of brand new ships past 4 years thinking market is their when it not and this years even more ships. This is going to be short live high guys..