Iron Ore’s Four-Year Slide Hitting Mining Earnings: Commodities

Steel Sep 22, 2011 No Comments

Iron oreGlobal prices may fall 29 percent to an average $123 a metric ton in 2015 from a record $173 this year, according to the median estimates of 10 analysts surveyed by Bloomberg News. The decline contrasts with estimates for little change in copper and a 10 percent increase for aluminum in the same period, London Metal Exchange futures prices show.

Iron ore is set for the first four- year drop since at least 1982 as supplies surge, threatening to end record earnings at Vale SA (VALE3), Rio Tinto Group and BHP Billiton Ltd. (BHP), the world´s biggest producers.

Iron ore supplies for export will jump 53 percent by 2015 even as slower growth in Chinese steelmaking saps demand, Goldman Sachs & Partners Australia Pty. said. That will reduce prices and profit that reached records this year for BHP and Brazil’s Vale, whose net income will fall almost 50 percent by mid-decade, according to data compiled by Bloomberg.

via Iron Ore’s Four-Year Slide Hitting Mining Earnings: Commodities – Bloomberg.

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Rod Sherkin

Rod is a former senior executive, responsible for Purchasing, for both Pillsbury and Ball Packaging back in the 80’s and 90’s. Since then, he has continued to work in the Purchasing field as both a consultant and founder of the website Propurchaser.com.

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