Demand for iron ore is expected to increase as a result of stimulus measures in China. Therefore, analysts estimate that overseas iron ore prices could rise as high as $150 per ton in the first half of 2024.
This forecast represents an increase compared to previous estimates. Measures announced in recent weeks to stimulate China's real estate market and increased demand in the infrastructure sector have pushed iron ore prices higher. The strong performance of China's steel exports and demand from the infrastructure and manufacturing sectors, which offset the decline in the real estate sector, led prices to exceed 2023 expectations.
Analysts believe that China's iron ore imports could hit a record high in 2023 and steel production could reach the second highest level since 2020. Global sea ore supply is also estimated to increase by 3.8%. However, analysts note that demand outside China is also increasing, leading to competition.
BMI raised its average price outlook for next year by 20% to $120, while Goldman Sachs raised its forecast by 22% to $110. Wood Mackenzie's forecast is up 8 percent to $108.
In addition to China, strong demand from India and the recovery in Europe are also expected to contribute to increased iron ore demand in 2024. However, analysts expect iron ore prices to range between $90 and $150 per tonne next year due to uncertainties such as the steel cap and government intervention.
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