Yancoal will have to pay Chinese coal levy

Chinese-owned coal companies in Australia are adamant they will not get a sweetheart deal on their shipments to China, after Beijing slapped surprise tariffs on coal imports last week, according to the Sydney Morning Herald.

Chinese-owned miner Yancoal, which has seven mines in Australia and a local listing, says it will not get a free pass on China’s new global tariffs because of its ownership.

“Yancoal will pay tariffs, just like every other exporter. There is no special deal for us,” Yancoal spokesman James Rickards said.

Glencore-Rio Tinto deal won’t change iron’s race to bottom, says Alberto Calderon

Alberto Calderon, the man who led the strategy team for BHP Billiton’s aborted mega-merger with Rio Tinto, has said the iron market is in a “race to the bottom” with its surplus production, but says a Glencore-Rio Tinto deal would do little to alter that, according to the Australian Financial Review.

“If only one company cuts production, this only benefits the other big ones,” he said.

“Then again, if they all produce as much as they can, it’s a race to the bottom. Unfortunately, that is where we are now. Next year, the iron ore market will have a surplus of 250 million tonnes.”

He said China’s coal tax was further evidence of the market’s oversupply.

Real estate poses biggest risk to China’s economy, says PBOC key man

China’s top central bank economist, Ma Jun, warned the sluggish real estate sector was the biggest risk to the country’s economy as a marked slowing in property investment hits the iron ore-dependent steel sector, according to the Australian Financial Review.

Dr Ma, chief economist at the People’s Bank of China, said the chance of a hard landing in Australia’s biggest export market was “very low”, but he was candid that debt in the real estate sector was “too high”

“The main concern of the downside risk to the economy is the real estate sector,” Dr Ma said.

Chinese property developers have rapidly built apartments and many buildings are vacant. The excess supply has caused real estate investment growth to slow to 14% in the past year, down from a peak of 35%.