Analysts raised their forecasts for iron ore prices after a recent jump, when for the first time in five years the price of iron ore with an iron content of 62% exceeded $ 100 per ton CFR, mainly due to a shortage of supplies from Brazil.
Most analysts expect iron ore prices to average 82-92 dollars per ton CFR, while S & P Global Platts estimated 62% of Fe to 102.45 dollars per ton.
RBC Capital Markets described price increases over the past five months as “exceptional” in a research note on Friday. The Canadian bank raised its forecast for iron ore by 24% to $ 82 / ton.
Goldman Sachs said that steel consumption in China surprised up, while Vale production surprised down. According to the National Bureau of Statistics, steel production in China by 314.6 million tons in January-April increased by 10% over the same period last year.
Goldman Sachs raised its iron ore price forecast by 12% to $ 91 / ton.
Goldman Sachs and RBC noted that the iron ore market is likely to be at its peak in terms of limited supply.
RBC expects that due to the high demand in China this year there will be a deficit of about 83 million tons of iron ore, and in 2020 the surplus will be 55 million tons. RBC forecasts that in 2020 prices will average $ 65 per ton.
Australian Commonwealth Bank raised its price forecast for 2019 by 7% to $ 92 / ton, noting that port stocks are in a “free fall” state.
“The lag between the reduction of reserves in the port and the disaster of the Vale dam at the end of January reflects the time of ore shipment from Brazil to China (approximately 50 days) and Vale’s efforts to deplete any existing reserves,” the CBA said on Friday.
The National Australian Bank raised its iron ore price forecast for this year to $ 86 per ton, which is 5% higher than the forecast it had given a month earlier. Next year, prices will average $ 72 per ton.
