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Saturday, 30 May 2020

Iron ore to the moon (Brazil pandemic)

Brazil pandemic

Alarming reports out of Brazil, with more than 26,000 new cases of COVID-19 reported in a single day.

These horrendous figures include a severe cluster down at Vale's Itabira project on Minas Gerais in Brazil. 

This means supply disruption for iron ore at a time when China is beginning to build up a storm.

Iron ore is soared above $100/tonne for the first time since the first week of August 2019.

This is big news for Fortescue Metals Group (ASX: FMG), and for Australia more broadly.

There's still even a slim or outside chance that Australia avoids a technical recession by reporting a flat result for Q1 GDP next week, in no small part thanks to the volume of iron ore exports.