The fly-up scenario for Copper is going to be something else.

By Tshepo Magagane

When we started

1. We were buying every asset around for the Mittal – state owned assets people would pay you to take them off your hands (from Ukraine to SA to Canada to France)

2. See Kumba – it was spun out of Iskor (the steel co in SA) for just a cost+3% agreement – the only analyst who saw value in it was at JPM (he was the laughing stock of the market)

3. And more importantly, iron ore is not only the 4th most abundant element on earth and very easy to extract; China has massive resources of it albeit lower grade

4. So they needed to buy on the seaborne market from Aus, Bra, SA

5. They tried to break the then annual price settlement (seaborne traders would sit with Jap/Kor steelmakers to set a benchmark for the year)

6. Backfired spectacularly over 2 decades back – price in 06 almost doubled to 60/t

7. Then it really took off – traded to just under 300/t

8. The Aus/Braz were producing at 15/t and SA 25/t

9. Fly-up scenarios are driven by demand

10. See gold – all the nonsense about rates correlation (only started moving when central banks started buying)