International credit rating agency Fitch Ratings has announced that it has raised its iron ore price assumptions for 2023, 2024, 2025 and 2026, while also increasing its coking coal price assumptions for 2023 and 2024, though keeping its coking coal price assumptions for 2025 and 2026 stable.
The agency has increased its iron ore price assumptions to $118/mt from $110/mt for 2023, to $95/mt from $85/mt for 2024, to $80/mt from $75/mt for 2025 and to $75/mt from $70/mt for 2026, to reflect restocking expected in 2024 due to low inventory levels and a supportive supply-demand balance in the medium term. The increased medium-term price assumptions reflect the longer time required for capacity additions to reach the market, meaning no oversupply beforehand.
The price assumptions for coking coal have been raised to $290/mt from $250/mt for 2023 and to $210/mt from $190/mt for 2024, due to increased production costs and seaborne supply disruptions amid adverse weather conditions, while the price assumptions for 2025 and 2026 remain the same at $180/mt and $170/mt, respectively. The agency stated that coking coal demand, particularly in China, is likely to be sustained.
