Iron ore prices fall to their lowest level since 2009

Thursday, 06 November 2014 18:08:34 (GMT+3)   |   Istanbul
       

Global iron ore prices, which have been declining since the beginning of the current year, have decreased to their lowest level since September 2009 as of today, November 6, with offers for 61.5 percent Fe content iron ore from Australia now at $75-76/mt CFR China. Iron ore prices have fallen by 45 percent since January this year. As oversupply continues to prevail in the global iron ore market, iron ore stocks at Chinese ports have been on the high side lately, putting downward pressure on import iron ore prices in the Chinese market. Additionally, as iron ore prices in the Chinese spot market continue to decline, it is getting harder for Chinese iron ore producers to compete with imported products. Under these circumstances, some small-sized Chinese iron ore producers have halted their production.
 
In the last quarter of the year, expectations are for steel trading activity in China to slow down slightly due to the winter and the New Year holidays, which will contribute to the downward movement of iron ore prices. Meanwhile, ex-Australia offers for 61.5 percent Fe content iron ore are predicted to fall to $70/mt CFR China by the end of the current year. If the sharp downtrend continues, it is possible iron ore prices will drop to this level well before the end of the year.
  
On the other hand, China is hosting the Asia-Pacific Economic Cooperation (APEC) meeting in Beijing until November 12. strict environmental protection measures are being implemented for the duration of the event and some steel plants have halted their production. It is believed that these precautions may continue to be implemented after the meeting and Chinese steel producers' demand for iron ore may decline amid steel production halts.
 

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