THE WAR CON­TIN­UES

Finweek English Edition - - SIMON SAYS -

The iron ore price war to the bot­tom con­tin­ues with t he BHP Bil­li­ton* pro­duc­tion up­date. The com­pany’s iron ore pro­duc­tion was up 16% and its costs are be­low $20 (R243) a ton. This makes it one of the world’s cheap­est pro­duc­ers and gives the com­pany a lot of space as prices con­tinue to fall. With the Chi­nese gov­ern­ment pre­pared to sup­port its small pro­duc­ers, a low pro­duc­tion cost is ab­so­lutely crit­i­cal as iron ore prices are likely to con­tinue fall­ing with talk now of about $30 (R365) a ton.

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