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Iron ore prices to remain firm, says Macquarie analyst

Tatyana Shumsky
From: Dow Jones Newswires
June 21, 2011 7:52AM

Iron ore prices to remain firm, says Macquarie analyst

Tatyana Shumsky
From: Dow Jones Newswires
June 21, 2011 7:52AM

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IRON ore prices will remain firm in the medium term, as tight supply struggles to keep up with Chinese steel output, said Macquarie Commodities Research senior analyst Colin Hamilton at Platts Steel Methodology Forum in New York.

"As small Chinese steel mills are ramping up production, there's a high chance the iron ore price will go up," he said.

Recent data suggest China's steel output will maintain above 700 million tonnes a year, he said.

The global iron-ore supply chain is struggling to keep up with that demand, and flat iron imports to China reflect the strain in existing infrastructure.

"The supply chain has been stretched to the limit," Mr Hamilton said.

"Chinese imports of iron ore are down because there's not much material available."