This guy still wants to pay out dividends. On one hand, he’s saying the high cost producers are ‘hanging on by their fingernails’, or the skin on their cocks. On the other, he believes prices are laughably cheap down here, clowning those who believe that current trends will prevail and iron ore will hit $30.
“Most of that tonnage falls into the high-cost category. So at the moment, those people are hanging on by their fingernails,” he added. “But sooner or later the adjustment will take place.”
The spot iron ore price [.IO62-CNI=SI] fell to its lowest since at least 2008 at $37 (£24.4) a tonne last week amid shrinking demand for the steel-making ingredient in major consumer China.
Rio as the world’s lowest cost producer is still profitable even as prices have slumped.
When asked if prices could slide as low as $30 a tonne, Walsh said it would not be able to remain there long due to the large number of mines that would shut down.
“It’s not sustainable. It is fantasy land at that level.”
Do you know what’s ‘fantasy land’, mate? The fact that you still pay a dividend or think the China boom is simply taking a breather. Also, this is funny too. Your fucking stock chart.
Iron Ore is going to make crude charts look fucking bullish
check TCK chart