Iron ore price hits five-week low as traders fret about Chinese demand
Iron ore has slumped 29% this year, hurt by the prolonged slowdown of China’s economy.
Look no further than rail traffic totals to see that the US is ditching coal and embracing natural gas.
Petroleum products carried via rail are way up this year, showing cummulative gains of 38.8% over the same period in 2011, according to the Association of American Railroads (AAR). In contrast, coal has fallen during this same same period 10.1%. The association reported its weekly traffic totals up to week 28 of this calendar year ending on July 14.
Thermal coal demand is dropping in the US. Electrical utilities are switching to gas, which costs half as much as coal.
Rail shipments show the economy is weak. Total rail shipments, overall, are down 2.6% compared to last year.
On the bullish side motor vehicle shipments are up 22.9%, and shipments of metallic ore are ahead of last year’s totals by just 4.5%.
And week 28’s rail shipment totals are 1.7% higher than the same week a year ago.
Comments
Chip
As a curiousity, what percentage of the motor vehicle shipments were coal, and what is the percentage increase/decrease in coal & petroleum product shipment in that transport mode?