Commodity Market Report

Global iron ore long-term outlook Q1 2016

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31 March 2016

Global iron ore long-term outlook Q1 2016

Report summary

The Global Iron Ore Market Long-term Outlook provides the latest update of detailed supply and demand analysis and price forecasts for the iron ore market to 2035. We have a more negative outlook for iron ore than we presented in our Q4-15 update, mainly due to a further downward revision to Chinese steel consumption. We have lowered our average price forecast for the period 2017-21 by approximately 6% with the low point of the cycle expected to occur in 2018 with an annual average price of $45/t CFR (real 2016 terms). Our long term price remains at $70/t CFR (real 2016 terms) but a return to that level is unlikely for at least 10-15 years as there is no requirement to incentivise additional supply prior to 2030.

Table of contents

  • Executive summary
  • Key changes to demand outlook
  • Key changes to supply outlook
    • Iron ore price forecast: fines (62% Fe), US$/dmt
  • Demand
    • Key demand forecast data
    • China
      • Steel and hot metal outlook
      • Iron ore demand outlook
    • Japan
    • South Korea
    • Taiwan
    • India
    • Other Asia
  • Europe
  • CIS
  • North America
  • South America
  • Middle East
  • Africa/Oceania
  • Supply
    • Medium term view
    • Long term view
    • Key changes to global export forecast
      • Australia
      • Brazil
      • Asia
      • Middle East
      • North America
      • Africa
      • CIS
      • Asia
        • Resources and production
      • Other Asia
      • Europe
        • Sweden
        • Norway
      • CIS
        • Russian Federation
        • Ukraine
        • Kazakhstan
      • North America
        • Canada
        • United States
        • Mexico
      • South America
        • Brazil
          • Vale
          • Other Brazilian Producers
          • Other South America
          • Africa
            • South Africa
            • Mauritania
            • West Africa (excluding Mauritania)
          • Australia
            • Overview
            • Key changes to our supply forecast for Australia
          • Middle East
  • Supply-demand balances
    • Short term outlook (revised up):
    • Medium term outlook (revised down):
    • Long term outlook (no change – but risk on timing):
      • Iron ore price forecast: sinter fines, FOB Australia
      • The medium-term outlook to 2020
        • What's changed?
          • Key factors influencing for the medium term price outlook include the following:
        • China delivered cost curve and breakeven analysis
        • Price outlook for lump
          • Past trends in lump premia
          • Future trends in lump premia
            • Iron ore lump premia
            • Price outlook for pellets
              • Past trends in pellet premia
              • Future tends in pellet premia
              • The long-term outlook (post 2025)
                • Overview
                • Long run trade balance
                • Long run incentive price

Tables and charts

This report includes 32 images and tables including:

  • Europe: key demand forecast data
  • CIS: key demand forecast data
  • North America: key demand forecast data
  • South America: key demand forecast data
  • Middle East: key demand forecast data
  • Executive summary: Table 1
  • Demand: Table 1
  • Global consumption of iron ore by product
  • Growth in iron ore consumption and imports
  • Chinese crude steel production (Mt)
  • China: iron ore consumption, imports and supply
  • Hot metal vs. scrap supply
  • Burden mix in blast furnaces
  • Chinese iron ore demand, supply and imports
  • Asia (ex-China): key demand forecast data
  • Iron ore production and exports by major country
  • Iron ore exports by key company
  • Iron Ore Exports: Brazil vs. Australia
  • Share of Global Exports: Brazil vs. Australia
  • Supply-demand balances: Image 1
  • Chinese iron ore reserve by province
  • Chinese mined iron ore production
  • Supply: Image 3
  • Cost curve - Chinese imports of sinter fines 2016, US$/t CFR China, 62% Fe
  • Company breakeven costs (62% Fe fines delivered to China)
  • Supply-demand balances: Image 4
  • Iron ore pellet premia
  • Growth in iron ore consumption, China vs. India
  • Iron ore trade balance and price forecast
  • Iron ore long run supply/demand balance
  • Incentive price analysis for selected projects
  • Supply-demand balances: Table 1

What's included

This report contains:

  • Document

    IOMS LT Datafile Q1 2016.xls

    XLS 979.00 KB

  • Document

    Global iron ore long-term outlook Q1 2016

    PDF 752.48 KB

  • Document

    Global iron ore long-term outlook Q1 2016

    ZIP 1.02 MB

  • Document

    Executive summary

    PDF 87.60 KB

  • Document

    Demand

    PDF 258.83 KB

  • Document

    Supply

    PDF 272.37 KB

  • Document

    Supply-demand balances

    PDF 239.67 KB