Iron Ore Price Surge Short-Lived as Long-Term Fundamentals Take Hold
It appears the two week surge in the price of iron ore was short-lived as reality surrounding the steelmaking industry in China (accounting for ~50% of global steel production) took hold. The 62% Fe import price failed to break the $60 psychological barrier and suffered a 4% drop on Wednesday after rising over 26% since mid-April. It is believed that the two-week surge in the price of iron ore relates to short-term restocking by Chinese steelmakers as the struggling industry saw the closure of a number of high-cost marginal producers; however, commentators still see significant over-supply in them mid-term. The recent spike in iron ore was reflected in the performance of a number of iron ore producers, including the share price of one major Brazilian producer which rose almost 27% from three 21st to the 27th April. Meanwhile, the price of gold rose above the $1,200 per ounce mark on Monday before falling to $1,178 per ounce Friday (↓0.05%). Silver, platinum and palladium prices were all up marginally during the week finishing at $16.15, $1,132 and 774 per ounce respectively. Base metals surged during the week, led by copper (↑6%), nickel (↑4%), lead (↑2.8%) and zinc (↑5%), each of which finished at $2.91, $6.22, $0.96 and $1.07 per pound respectively. The price of WTI crude also rose during the week, almost reaching the $60 per barrel mark before settling at $59.20 per barrel. Finally, uranium finished at $35.69 per pound lower (↓6.5%).
Here’s an overview of what’s in the Dig this week:
Click here for the full report.
Important Information and Legal Disclaimers
All prices are in C$ unless noted
This report is neither a solicitation for the purchase of securities nor an offer of securities. Our ratings are intended only for clients of Haywood Securities Inc., and those of its wholly owned subsidiaries, Haywood Securities (USA) Inc. and such clients are cautioned to consult the respective firm prior to purchasing or selling any security recommended or views contained in this report.
Estimates and projections contained herein, whether or not our own, are based on assumptions that we believe to be reasonable. The information presented, while obtained from sources we believe reliable, is checked but not guaranteed against errors or omissions. Changes in the rates of exchange between currencies may cause the value of your investment to fluctuate. Past performance should not be seen as an indication of future performance. The investments to which this report relates can fluctuate in value and accordingly you are not certain to make a profit on any investment: you could make a loss.
Haywood Securities, or certain of its affiliated companies, may from time to time receive a portion of commissions or other fees derived from the trading or financings conducted by other affiliated companies in the covered security. Haywood analysts are salaried employees who may receive a performance bonus that may be derived, in part, from corporate finance income.
Haywood Securities, Inc., and Haywood Securities (USA) Inc. do have officers in common however, none of those common officers affect or control the ratings given a specific issuer or which issuer will be the subject of Research coverage. In addition, the firm does maintain and enforce written policies and procedures reasonably designed to prevent influence on the activities of affiliated analysts.
Dissemination of Research
Research reports are disseminated either through electronic medium or in printed copy. Clients may access reports on our website, or receive publications directly via email. Haywood strives to ensure all clients receive research in a timely manner and at the same time. It is against our policy for analysts to discuss or circulate their recommendations internally prior to public distribution. This policy applies equally to recommendation changes, target changes and/or forecast revisions.
For Canadian residents: Haywood Securities Inc. is a Canadian registered broker-dealer and a member of the Investment Industry Regulatory Organization of Canada, the Toronto Stock Exchange, the Toronto Venture Exchange and the Canadian Investor Protection Fund and accepts responsibility for the dissemination of this report. Any Canadian client that wishes further information on any securities discussed in this report should contact a qualified salesperson of Haywood Securities Inc.
For U.S. residents: This investment research is distributed in the United States, as third party research by Haywood Securities (USA) Inc. Haywood Securities (USA) Inc. is a wholly owned subsidiary of Haywood Securities Inc., registered with the U.S. Securities and Exchange Commission, and is a member of FINRA and the Securities Investor Protection Corporation (SIPC). Haywood Securities (USA) Inc. as a U.S. registered broker-dealer accepts responsibility for this Research Report and its dissemination in the United States. Any U.S. client that wishes further information on any securities discussed in this report or wish to effect a transaction in these securities should contact a qualified salesperson of Haywood Securities (USA) Inc. Haywood Securities Inc. Research Analysts are considered Foreign Research Analysts to the USA and are not registered/qualified as Research Analysts with FINRA. As these analysts are considered Foreign Research Analysts they may not be specifically subject to FINRA (formerly NASD) Rule 2711 and FINRA (formerly NYSE) Rule 472 restrictions on communications with a Subject Company, Public Appearances and trading securities held by a Research Analyst Account.
This report may be distributed in the following states: nil. Otherwise, this report may only be distributed into those states with an institutional buyer state securities registration exemption.
We, Kerry Smith, Stefan Ioannou, Tara Hassan, Geordie Mark, Mick Carew, Colin Healey and Ben Asuncion, hereby certify that the views expressed in this report (which includes the rating assigned to the issuer’s shares as well as the analytical substance and tone of the report) accurately reflect my/our personal views about the subject securities and the issuer. No part of my/our compensation was, is, or will be directly or indirectly related to the specific recommendations.
Of the companies included in the report the following Important Disclosures apply:
Other material conflict of interest of the research analyst of which the research analyst or member knows or has reason to know at the time of publication or at the time of public appearance:
Absent the use of encryption, E-mail is not a secure medium and privacy cannot be ensured. Email is vulnerable to interception and forging. Haywood Securities Inc., its subsidiary Haywood Securities (USA) Inc. and their employees cannot ensure the privacy and authenticity of any information or instructions you send to us by E-mail. All E-mail communication is subject to delay and may from time to time be undeliverable due to technical problems. WE RECOMMEND YOU DO NOT SEND CONFIDENTIAL INFORMATION OR INSTRUCTIONS such as orders to buy or sell a security and money or security transfer requests by E-mail. Haywood Securities Inc., its subsidiary Haywood Securities (USA) Inc. and their employees will not be responsible for verification of any instructions received by E-mail or for any damages you may incur if you communicate confidential information or instructions to us by E-mail. Haywood Securities (USA) Inc. is a member of the Securities Investor Protection Corporation, as well as the Financial Industry Regulator Authority. The firm’s place of business is Suite 700 – 200 Burrard Street, Vancouver, BC, V6C 3L6, phone (604) 697-7400, facsimile (604) 697-7481.
Please click here to unsubscribe from all future email communication from Haywood Securities Inc. We will respect all unsubscribe requests . Please allow 5 business days to process your request. If you have any questions, please contact us at Haywood Securities Inc. (Head Office), 200 Burrard Street, Suite 700, Vancouver, BC, V6C 3L6. Tel: 604-697-7100 or Toll: 1-800-663-9499.