Commodity Market Report

Global iron ore long-term outlook Q3 2018

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28 September 2018

Global iron ore long-term outlook Q3 2018

Report summary

Against a backdrop of heightened global geopolitical risk and associated commodity price volatility, it is remarkable that iron ore is in the midst of its longest period of price stability since the index was launched. But there is plenty going on behind the scenes – at the forefront of which is China’s steel restructuring program and rising environmental standards which have transformed pricing and demand for iron ore. In this long-term outlook find out: Why we now forecast wider price spreads for high grade and low grade iron ore When Chinese iron ore demand peaks Why we are significantly more bullish on India’s seaborne iron ore import volumes

Table of contents

    • Key "swing factors" that could significantly alter our long term view
  • Demand
    • China – Blue skies in Beijing
    • India – the time is now
    • EU28
    • Japan
    • China
      • Our view on slowing hot metal production has not changed
      • However, the BF-BOF route still dominates
      • Medium, large and super large blast furnaces will make up around three-quarters of hot metal capacity by 2025
        • China's blast furnace size categorisation
      • Hot metal capacity in the contestable market will increase; imported raw materials demand to sustain in the long term
        • China's contestable and non-contestable market segmentation
      • Iron ore demand
    • India
      • Steel and hot metal production to grow driven by domestic steel demand
    • Japan
    • South Korea
    • Taiwan
    • Indonesia
    • Vietnam
    • Other Asia
    • EU28
    • Turkey
    • Russia
    • Ukraine
    • United States
    • Mexico
    • Canada
    • Brazil
    • Other South American countries
  • Australia
    • Steel production: it's (nearly) all about Iran
    • South Africa
    • Overview
    • Key changes to our forecast
      • Australia
      • Brazil
      • Asia
      • Africa
      • Developments in the world's major seaborne suppliers
        • Australia
        • Brazil
          • Vale
          • Other Brazilian producers
        • South Africa
        • Canada
        • Ukraine/Russian Federation/Kazakhstan
        • Russian Federation
        • Ukraine
        • Kazakhstan
        • Chile
        • Peru
        • Mauritania
      • Key supply side developments in China and India
        • China
          • Environmental pressure constrains domestic supply
          • Domestic pellet expansion to tighten pellet feed market in China
        • India
    • Short term outlook (revised up):
    • Medium term outlook (revised down):
    • Long term outlook (no change – but positive price risk):
      • Upside risk:
      • Downside risk:
      • The Medium Term Outlook
        • Key points:
        • Iron ore costs and prices – the medium term view
          • Price outlook for lump
            • Past trends in lump premia
            • Future trends in lump premia
          • Price outlook for pellets
            • Past trends in pellet premia
            • Future tends in pellet premia
            • The Long Term Outlook (post-2025)
              • Methodology
              • Long run trade balance
              • Long run incentive price

Tables and charts

This report includes 41 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
  • Key demand forecast data
  • Global consumption of iron ore by product
  • Growth in iron ore consumption and imports
  • China key demand data
  • Hot metal production declines
  • as DRI production rises
  • Global exports to peak within five years
  • Share of global exports by key countries
  • Iron ore production and exports by major country
  • Chinese iron ore demand, supply and imports
  • Asia (ex-China): key demand forecast data
  • Medium-term iron ore consumption revised up
  • Changes to BF charge rates
  • There are upside and downside risks to our iron ore consumption forecast
  • Of which the largest is that of meeting government production targets
  • Iron ore exports by key company
  • Iron ore price forecast revision: Q3-18 vs Q2-18
  • Long term iron ore price forecast
  • Demand: Table 3
  • China's hot metal capacity by blast furnace size
  • China's hot metal capacity mix
  • Demand: Image 5
  • Odisha on the rise while Goa shrinks
  • India - now a relatively insignificant supplier to China
  • Iron ore price spreads (recent trends)
  • Iron ore price spreads (forecast)
  • Margin analysis
  • Breakeven curve analysis
  • China's pellet capacity and expansion by market segment
  • Increasing pellet share in China's blast furnace burden
  • Iron ore lump premium
  • Blast furnace pellet premium
  • Global seaborne trade in iron ore
  • Long run supply "gap" analysis
  • Project incentive curve (basis 62% Fe fines, CFR China)
  • Incentive price analysis - selected projects

What's included

This report contains:

  • Document

    Global iron ore markets long-term outlook data 2018 Q3.xls

    XLS 1.25 MB

  • Document

    Global iron ore long-term outlook Q3 2018

    PDF 1.28 MB

  • Document

    Global iron ore long-term outlook Q3 2018

    ZIP 1.56 MB

  • Document

    Executive summary

    PDF 701.13 KB

  • Document


    PDF 879.77 KB

  • Document


    PDF 815.01 KB

  • Document

    Supply-demand balances

    PDF 1.04 MB

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