Stocks that Float: TANKERS & DRY BULK SHIPPERS

[Milner]

Yes indeed,

I keep reading about a total collapse of the Chinese steel production. From everything i have been reading though it seems like the Chinese stockpiled at least 1/3 more iron ore than was originally thought. My take on this is that when the Chinese stockpiled commodities in the past they always fell short of having enough to totally drive prices of those commodites extremely low. So this time they deliberatly stockpiled much more than anyone could have imagined. This caused a complete meltdown of the charter rates and the commodity prices. Just following the money would indicate the Chinese benefited from this in the short term. I think the ore producers realized if they caved in it would set a bad precident. Once the Chinese run out of stockpiled ore and coking coal they wont be able to make steel. The BDI should bounce back. Factor in the U.S. financial bailout package and the commodity prices oil included should rebound. I think there is a chance the whole thing could backfire on the Chinese. They just feel they need to drive commodity prices down by hoarding but its just the cycle and they pendulum should swing back in favor of the ship owners and ore producers soon. I could be wrong though. I have a feeling about it though...