Global iron ore market is facing continuous downturn movement. Prices were recorded at USD 45.1 /MT, CFR China on 19 Nov’15. This level was last seen in the month of Jul’15; recorded a new 10 years low level at USD 44/MT, CFR China. That time prices had somewhat recovered, but now it seems that there is less chances for price recovery.
Iron ore demand in China is extremely low. Steel output cut by major Chinese steel mills and lower steelmakers’ margins have implied more output reductions, which will definitely affect iron ore prices in coming term.
The inbound supply glut by Rio Tinto, Vale and BHP has forced prices to tumble down 10 years low. Moreover, prices are on the track to drop down further in coming term.
Globally, iron ore prices have plunged down two times to a level of USD 44-45/MT, CFR China this year due to rising low cost supplies from the world’s major miners such as Rio Tinto, Vale and BHP Biliton. In addition, slowdown of China’s steel demand and consumption has also forced prices to drop down further.
China Iron & Steel Association has also forecasted that steel production will fall further by next year.
Market analysts anticipate that iron ore and steel prices in China will decline further from the current levels. Most probably, iron ore prices may touch a level of USD 40-44/MT, CFR China by the end of Mar’16.
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