Iron ore prices falls for consecutive five days on China’s weak demand
It is reported that the Shanghai steel futures have fallen for consecutive five days, causing iron ore prices down to the lowest level within 6 weeks, due to tight credit conditions in China since the end of last year.
According to Steel Index, the benchmark of iron ore contains 62% Fe have dropped for consecutive six days on Tuesday, down by 1.8% to US$139.6/ton, touching the lowest level since January 4th.
However, some market participants have still seen a pickup in following months due to resume after winter. It’s known that Australian miner Fortescue Metals Group planned to hike iron ore prices to China in the near future.
On the other hand, Bank of America-Merrill Lynch has different point of view and it forecasted the growth rate of steel demand in China would be at 6% this year and 5.8% in 2013, compared to CAGR 12.8% from 2008-2011.
Bank of America-Merrill Lynch said that China’s steel market will experience another difficult year and the price is likely fall by an average 4% in 2012 due to the continuous expansion in the country’s crude steel production.
China’s crude steel is estimated to expand by 50 million tons this year, according to China Iron and Steel Association.
News Date 16 Feb 2012 10:59:50 reported by Raul Lee