Standard Chartered Plc said that iron ore prices will face downward pressure in the next three months because of increasing supply from Brazil and weakening global steel demand.”
Standard Chartered analyst Ms Judy Zhu in a report said that there is also a risk of iron ore destocking in China. According to the report, spot iron ore, Indian origin, will be USD 170 a tonne in the third quarter compared with USD 175 a tonne in the second quarter,Ms Zhu wrote that “Softer steel markets in many regions have negatively impacted market sentiment. We expect modest declines in spot iron-ore prices in the next three months as Brazil’s exports recover further and demand enters the off-peak season with the start of the summer holidays in Europe and the US.”
China, the world’s biggest consumer of iron ore to make steel, produced about 47 percent of the world’s output of the metal in April, according to the World Steel Association. Production may fall from next month as the country rations power, forcing mills to reduce manufacturing, RS Platou Markets AS in Oslo said on May 25.
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