International money manager WHV Investment Management believes the fundamentals of iron ore remain robust, and their latest report explains why.
"Conventional wisdom says one should invest in what China buys and avoid anything that China can produce on its own. Iron ore, one of the favored natural resources in the WHV International Equity strategy, provides an illustration of why this has worked. To fuel its continued growth, China has a seemingly insatiable demand for the high quality product of the big three iron ore miners. The companies, BHP Billiton, Rio Tinto and Vale, are focused on meeting this demand while growing profits through a combination of declining costs and increasing volumes. Both the demand and supply trends may be subject to interruptions. However, we believe that the stage is set for compelling long term returns on the WHV International Equity iron ore investments."
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