Friday, April 29,
Spot market iron ore prices could raise as high as $200/MT by the end of the year before falling back, said an iron ore executive in Brazil.*
Prices will remain firm for the next two years as demand for the steelmaking ingredient stays strong and new projects may delay bringing new capacity into production, said Roger Downey, Chief Executive Officer of Brazilian iron ore miner MMX Mineracao e Metalicos.
After hitting the $200/MT mark, iron ore spot prices may then fluctuate under that level for the next two years and tension in the market should continue for as much as five years, Downey added.
The rising cost of obtaining capital for new investments in iron ore capacity is expected to delay many of the 180 new iron ore mine projects currently being developed worldwide. New supplies are going to come onto the market “later rather than sooner”.
Roy Vivian, foreign trade director of Brazilian steelmaker Usinas Siderurgicas de Minas Gerais SA said at the event that he foresees spot iron ore prices rising to around $190 a ton at year end, contributing to expected volatility in steel prices.
“Greater volatility is leading steelmakers’ profit margins to fall, linked to pressure from raw materials prices,” Vivian added.
Source: Dow Jones
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