2017 OUTLOOK: Iron ore market braces for ramp-ups, stricter Chinese policies

The iron ore market is bracing for a significant ramp-up in production this year on the back of a spike in prices in 2016 when strong demand outweighed supply.

Government policies were the driving force behind the steel market in China last year amid a crackdown on oversupply in the ferrous sector and measures to check pollution.
In 2017, Beijing’s push to weed out outdated capacity, along with an increase in the supply of seaborne iron ore will again have a significant effect on prices.
Earlier last week, the Chinese government set a mid-2017 deadline to weed out the production of substandard steel in the country.
The news sent the country’s benchmark ferrous futures contracts up by 7-9% on Tuesday January 10 – all closing at their daily limits with the exception of that for coking coal.

“We believe that steel and iron ore prices will remain resilient in the first half, driven by further restocking by steel mills, stronger demand for high-quality steel and the displacement of scrap capacity in China,” Benedikt Sobotka, ceo of Kazakhstani miner...

Published

July Zhang

January 17, 2017

09:20 GMT

Shanghai