COLUMN-Iron ore rhetoric should shift from China demand to oversupply: Russell
--Clyde Russell is a Reuters columnist. The views expressed are his own.--
By Clyde Russell
LAUNCESTON, Australia, Nov 7 (Reuters) - One of the recurring themes in iron ore's precipitous decline this year has been the weak state of Chinese demand. The problem with this is that it simply isn't true.
It doesn't take much of a search to find media and analyst reports that reference softness in China's steel market as one of the major reasons for Asian spot iron ore's .IO62-CNI=SI 43-percent decline this year to a five-year low of $75.60 a tonne on Thursday.
"Iron ore falls further as Chinese buying interest stalls" was a Reuters headline from Oct. 17.
Just in case anybody thinks I'm picking on my own colleagues, this one is from competitor Bloomberg on Thursday: "Iron drops to lowest since 2009 as APEC curbs dent demand" - a reference to steel mills closures ahead of the upcoming meeting of the Asia-Pacific Economic Cooperation group in Beijing as part of measures to control pollution.
It's not just news reports, analysts have also pointed to the slowing growth of China's economy.
"In China, slowing industrial trends and deteriorating property fundamentals are having an adverse impact on bulk commodity demand - prices of iron ore and thermal coal both hit five-year lows," said a recent research report from a major bank. Continuación...