Iron Ore Price, page-45

Iron ore price falls for fourth day

• DANIEL PALMER
• FEBRUARY 27, 2015 7:00AM

The price of iron ore is flirting with a new five-and-a-half-year low after extending its losing streak to four days overnight.

At the end of the latest offshore session, benchmark iron ore for immediate delivery to the port of Tianjin in China was trading at $US62.50 a tonne, down 0.6 per cent from its previous close of $US62.90 a tonne.

The commodity is holding just 2.2 per cent above the five-and-a-half-year low of $US61.10 a tonne set three weeks' ago and at risk of falling below $US60 for the first time since 2009.

The falls have come amid reports of soft buyer interest in China with a recovery dependent on demand ahead of the start of construction season, which kicks into gear at the end of March.

The price of iron ore has more than halved since the same time last year, with recent financial reports from sector heavyweights Rio Tinto, BHP Billiton, Fortescue Metals Group and, just last night, Vale, highlighting the inevitable impact on the bottom line.

Both Vale and BHP have this week struck a sombre note on the prospects for an imminent recovery in the commodity's price, with the former suggesting a new "market equilibrium" would force more high cost producers out of the market.

Meanwhile, BHP has maintained a view that prices are unlikely to return to levels above $US80 a tonne anytime soon.

“I do fear that other competitors have an awful lot more capital waiting in the wings to invest in expanding,” BHP chief executive Andrew Mackenzie told analysts.
“We do look to the future and see a degree of pressure downwards on iron ore prices.”