Wood Mackenzie researcher responds to fall in iron prices
A commentary by Wood Mackenzie research director Paul Gray.
A commentary by Wood Mackenzie research director Paul Gray on falling iron prices amid coronavirus pandemic:
"Having demonstrated remarkable resilience for the past two months, the price of iron ore has taken a big hit in the past two days. Benchmark 62% Fe fines closed at $80.20/tonne on 23rd March, back to the lows seen in early February. If the price holds at $80/tonne for the remaining six trading days of March, the average price for Q1-20 would be $88.50/tonne. Remarkably, this is still above our pre-crisis forecast of $85/tonne in December 2019. This is largely due to the resilience of Chinese hot metal production coinciding with supply side constraints in Brazil and Australia. We think iron ore's sell-off over the past few days is the start of a trend, not a blip.