Vale Overtaking HP and Rio Tinto as Cheapest Iron Shipper?

Vale has reportedly leapfrogged over both Rio Tinto and BHP Billiton as the cheapest producer of iron ore as the race to the bottom of the iron industry continues.

According to Bloomberg:

The three producers collectively control about 60 percent of global exports and have been pumping billions of dollars into expanding output, squeezing higher-cost producers in an already over-supplied market. Oil slumped almost 50 percent last year, the most since the 2008 financial crisis, amid a supply glut, mirroring a 47 percent collapse in iron ore.

Iron ore with 62 percent content at the Chinese port of Qingdao dropped 1.2 percent to $70.30 a dry ton today, according to Metal Bulletin, trading close to the lowest in more than five years.

Paul Gait, an analyst in London with Sanford C. Bernstein Ltd., wrote in a research note:

In the last few months we have seen the price for bunker fuel collapse in lock-step with the decline in the global oil price and with it a reordering of the cost position of the global iron-ore industry has taken place.

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