“Clearly the market is pricing in more tightness to come, with speculative inflows on the Dalian and Singapore exchanges driving the price higher, but we forecast a seaborne deficit of just 35m/t next year,” Morgan Stanley said in a report headline “Iron ore defying gravity”.
China’s challenge with iron ore is that Australia currently supplies 60% of the its requirements and finding a replacement will not be easy.
Australia’s challenge with iron ore is to focus on other, smaller, customers in case China imposes restrictions on imports, an unlikely event today given the shortage of supply but a possibility in the future.
Cadence Minerals plc (LON:KDNC) provides mining services. The Company focuses on finding lithium and other technology minerals in new places, as well as offers extracting services.