Global Iron Ore Strategic Planning Outlook – Q2 2023
Chinese crude steel production is tracking 2% above last year through the first half of 2023. However, concerns are rising about the state of the Chinese steel demand. We project moderate steel demand growth in 2023. The current renewed optimism from China's stimulus measures faces ambitions from China to cap this year’s production to a level similar to 2022 – which will keep a lid on iron ore prices. We maintain our view of weakness in H2 2023 as rising supply is facing tepid demand prospects. We expect the iron ore price to trade around US$105/t through H2 2023 and at an average of US$100/t in 2024. Our long-term price (beyond 2032) was lowered in the previous update to US$73/t CFR (2023$ real terms) from the inclusion of the Simandou greenfield project in our base case forecast. This report presents our current assessment of iron ore market dynamics and long term price outlook.