The Iron Ore price in The Chart Library doesn't seem to be updating past November 3rd. Has Bloomberg changed something? It seems a bit of Murphy's Law as the Iron Ore price has been slumping further of late!

Eoin Treacy's view

Thank you for continuing to highlight the iron-ore price. One of the primary reasons we are having such difficulties with providing a reliable price for the commodity is because it is not freely traded. Following some consultation with Bloomberg I have updated the price once more and will monitor it daily to ensure it continues to update. 

Iron-ore remains in a consistent medium-term downtrend. Major investment in new supply has resulted in the three major producers ramping up supply just as demand peaked. Mines cannot simply be closed because prices have fallen since some revenue is better than no revenue and debt needs to be repaid. This is similar to the conditions that resulted in the triple waterfall crash of resources shares during the early 1980s and the greatest pressure falls on higher cost producers. 

For example UK listed London Mining has already gone bust and African Minerals’ shares were suspended today ahead of a further announcement. Brazilian listed MMX Mineracao e Metalicos filed for bankruptcy last week. At less than $80 a tonne this market scenario will also be putting pressure on China’s high cost, low grade suppliers. In order for prices to stabilise supply and demand need to come back into balance. This will require the removal of more high cost producers from the market and potentially an uptick in demand. 

In the iron-ore miners section of the Chart Library, located in Eoin’s Favourites area a number of accelerating downtrends are evident. By contrast while none of the major miners are trending higher, they have exhibited relative strength suggesting their competitive advantage in terms of the marginal cost of production is still intact. Clear upward dynamics will be required to check momentum at this stage.