Iron ore derivatives trade booms as prices tank and hedging rises
Producers driven to hedge to manage risk alongside speculators betting prices will fall further
Manila
TRADING volumes for iron ore derivatives have more than doubled this year from 2014 and are set to climb further, driven by a growing appetite to manage risks in a market where producers are struggling to survive as prices crumble.
A global glut, with major miners churning out iron ore in vast quantities and Chinese steel demand falling, have dragged prices of the raw material to their lowest since the financial crisis, squeezing margins at smaller producers and even forcing some out of business.
BT is now on Telegram!
For daily updates on weekdays and specially selected content for the weekend. Subscribe to t.me/BizTimes
Energy & Commodities
Oil settles higher on supply concerns in the Mid-East, economic woes subdue gains
Seatrium unit to fully redeem S$500 million worth of floating-rate bonds early
Anglo rejects BHP takeover bid as significantly undervalued
India rice prices at three-month low on shrinking demand
Gold prices set for weekly decline ahead of US inflation data
Pricey coffee is here to stay as hoarding, heat hit Vietnam supply