Iron ore prices may decline to $60 on weak Chinese demand, says JSW Steel

International News

JSW Steel Ltd., India’s most valuable steel producer, is predicting declines for iron ore next year as demand from biggest consumer China eases and supplies recover.
Prices may trade between $80 and $85 a ton for the rest of 2019 before sliding to $60 to $65 next year, Seshagiri Rao, joint managing director of the Mumbai-based mill, said. The key steel-making raw material has benefited from “speculation” and there is no reason why ore should be trading at elevated levels of about $95, he said.
“Gradually we are seeing some moderation” in steel production globally and “once the crude steel production comes down, including in China, then automatically the demand for raw material should come down,” he said in an interview Thursday. “Whatever disruptions we have seen in supplies are slowly, gradually normalizing.”
Iron ore has had a volatile year. It surged in the first half, triggered by supply disruptions in Brazil and Australia, and plunged in August as output recovered and global growth slowed. It is staging a revival this month, pushing back toward $100 a ton, on speculation that Chinese demand is holding up and there may be more mainland stimulus in the works.
Iron ore prices are moving in a completely different direction to other materials such as scrap, coking and thermal coal, and electrodes, which are declining and are more reflective of ebbing demand from the steel industry at present, Rao said.

 JSW imported between 6 million and 8 million tons of iron ore in the year ended April, he said. That works out to about as much as two-thirds of India’s total iron ore imports, which jumped 47 per cent to 12.8 million tons last year...Read More