India iron ore output set to plunge by one-third as court shuts 26 mines


Iron ore prices drop below $100/metric ton for the first time in nearly two years on worries that demand from China is being outpaced by increasing iron ore output from global miners.

However, WSJ reports that India's iron ore production could fall by nearly a third this year due to a new court decision that ordered an additional 26 mines to be shut down.

A top government mining official says the order may mean India's exports this financial year could end up near last year's level of 15M metric tons vs. expectations of a rise in output to ~22M tons; India exported as much as 118M tons of iron ore in 2009-2010.

Global iron ore producers include CLF, VALE, RIO, BHP.

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Comments (7)
  • smithson
    , contributor
    Comments (3) | Send Message
     
    In this scenario, what is the outlook for VALE?
    19 May 2014, 09:50 AM Reply Like
  • oubaseball
    , contributor
    Comments (11) | Send Message
     
    Smithson ...good question. You would think this would help VALE.
    19 May 2014, 11:16 AM Reply Like
  • pat45
    , contributor
    Comments (462) | Send Message
     
    This will eventually or quickly drive up iron prices, watch favorite miners closely, they will bounce dramatically as iron very cheap.
    19 May 2014, 11:32 AM Reply Like
  • lowercherty
    , contributor
    Comments (3) | Send Message
     
    90 million tonnes of production lost per year is a drop in the bucket of the world market. World iron ore production pushes 3 billion tonnes a year and growing. While the production loss is good for non Indian iron ore producers, it probably isn't significant in terms of iron ore price.
    19 May 2014, 12:42 PM Reply Like
  • chunghk
    , contributor
    Comments (346) | Send Message
     
    CLF-Despite above, range bound $17-$22. Low China demand; dwindling iron ore price; fight between Gary & Dropping. Bound to stay stagnant. Dividend 3.30% foreseeable & constant. No more, hope or sudden surge. Thanks.
    19 May 2014, 01:11 PM Reply Like
  • talsar
    , contributor
    Comments (2) | Send Message
     
    What is vale contract price to provide china with iron ore surly it would be already set for 2-3 years so all this rise a fall in iron prices is meaningless
    19 May 2014, 06:19 PM Reply Like
  • deckster8
    , contributor
    Comments (59) | Send Message
     
    Much Fe sits in China as a result of speculators who have a 90-day cycle to borrow funds, buy Fe, use as collateral for additional funds, etc. What happens to Fe inventories when authorities impose a 60-day cycle? How significant a glut and downward price pressure?
    20 May 2014, 05:50 AM Reply Like
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