Rio Tinto expects iron ore prices will fall one and a half times

Rio Tinto expects that iron ore prices will decrease by 50% of the current over the next 18 months and will reach a level of approximately $ 100/ton. As you know, today iron ore in world markets is offered to 150 - 160 dollars/ton, although in September last year no one gave more than $ 90 for it.

Mr. Vivec Talpul, the chief economist of Rio Tinto, presented a forecast according to which the cost of iron ore raw materials by September 2014 will decrease to $ 100 per ton. At the same time, Mr. Sam Walsh, the former director of the Rio, Rio, said that the last jump in the price of ore is temporary. Back in January, Walsh spoke about the short -term factors of this growth, such as replenishment of reserves at metallurgical plants in China and no more. It was then that Sam Walsh said that prices in Pio Tinto for iron ore can roll up to $ 50 at all.

According to the last analytical report of Deutsche Bank AG), iron ore prices will fall by 24% until the end of this year. This decrease will occur due to the increase in the global capacities for the extraction and processing of iron ore raw materials while weakening the demand for it. “The supply of iron ore raw materials will increase by 9 million tons in the second quarter of this year. At the same time, the restoration of demand caused by the replenishment of stocks at Chinese metallurgical plants in anticipation of the implementation of the state development program will disappear over the next few months. The peak of prices for the ore, which we observed in early 2013, has already been passed, ”says analyst Deutsche Bank Mr. Daniel Brebner.

“The increase in demand from Chinese consumers will slow down over the next two years, ore prices will fall up to $ 110 per ton. A further increase in the use of steel scrap in metallurgy will lead to an even more tangible drop in demand and price for iron ore up to $ 80 per ton, ”the bank predicts Deuteche.

Meanwhile, Rio Tinto is sure that the demand for steel and, accordingly, for iron ore will be restored in 2020-2040 in China, and after that in India and the countries of the ASEAN.