Iron ore prices in 2024 will range between $99-100 per tonne. In the second quarter and fourth quarter, prices will be at $100/t, and in the third quarter – $99/t. This is evidenced by the forecast of Capital Economics, according to the Australian Financial Review.
During the first quarter, iron ore prices fell by more than 25%. As of April 4, quotes on the Singapore Exchange were at $98/t, while on January 4, 2024, the figure was $136.6/t. The sharp quarterly decline worsened the market's annual expectations.By the end of next year, the prices for iron ore will fall to $85/t. The key reasons for the negative forecast include expectations of weak global steel demand. "Given the depressed demand, steel prices are likely to come under negative pressure this year as well.
We expect them to fall in China as supply continues to outstrip domestic and foreign demand. In the US, steelmakers are planning to expand production, but we believe demand will be weaker than they expect. Meanwhile, interest rate cuts will provide only marginal support to prices in Europe as economic growth remains weak," said Caroline Bain, chief commodity economist at Capital Economics.Capital Economics expects China's steel consumption to remain flat in 2024 and fall by 0.5% in 2025. In 2023, this figure fell due to the weakening of the real estate sector. "A correction in China's construction sector and steel demand is inevitable and is only delayed by political support.
By the end of the decade, real estate activity is likely to halve, with an average annual decline rate of 10%, which will lead to a similar drop in prices for construction materials, including steel," she added.As GMK Center reported earlier, Fitch Ratings has raised its iron ore price forecast for 2024-2026 amid tight supply. The price for this raw material is expected to reach $105/t in 2024, $90/t in 2025 and $85/t in 2026. The previous forecast was $95/t, $80/t and $75/t, respectively.
