From Frik Els at Mining.com:
“It’s going down significantly,” Katie Hudson, managing director and senior investment manager at Goldman Sachs Asset Management Australia told the Financial Review on Wednesday: “The major producers are adding incremental volume at around $US20 a ton, that gives you a sense of where the vulnerability is.”
Iron ore miners invested north of $100 billion in new projects and expansions since the start of the decade and most of those projects are now delivering or will do so soon. The big three producers are following a scorched earth policy of raising output and slashing costs to weather low prices and push out competitors.
This week top producer Vale announced record third quarter shipments of 88 million tonnes despite idling 13 million tonnes worth of high cost operations. More astonishing is the fact that the Rio de Janeiro-based company was able to reduce cash costs to just $12.70 per tonne (it’s in the high teens at Rio Tinto and BHP).
Read more at Iron ore price crashes through $50 | MINING.com