Iron Ore Prices Plunge to Nine-Month Low
“China, the world’s largest consumer of iron ore, imports more than 70% of globally traded volumes. That gives iron ore prices an outsized role as a proxy for Chinese economic momentum, and the latest trade data suggests the world’s second-largest economy is still struggling to gain momentum, remaining mired in deflation.”
“At the start of the week, figures from China showed that nationwide steel output in May declined on a daily basis compared to April. Output was down about 7% from a year ago, marking the weakest May since 2018.”
” ‘Steel demand in China is likely to remain weak over the coming months over the upcoming seasonal lull,’ Citigroup analysts wrote in a note, slashing iron ore forecasts.”
“They noted that China’s property market weakness has yet to show a meaningful turnaround while manufacturing continues to face headwinds. As a result, their three-month price forecast was lowered to $90 a ton from $100, and the six-to-twelve-month target was revised down to $85 from $90.”
https://oilprice.com/Metals/Commodities/Iron-Ore-Prices-Plunge-to-Nine-Month-Low.html