Bloomberg the Company & Products

Bloomberg Anywhere Login

Bloomberg

Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.

Company

Financial Products

Enterprise Products

Media

Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000

Communications

Industry Products

Media Services

Follow Us

Fortescue Sees Iron Ore at $140/Ton in Short Term on Low Stocks

April 22 (Bloomberg) -- Fortescue Metals Group Ltd., Australia’s third-biggest iron ore exporter, said “very low” ore stocks will keep the price of the steelmaking material at $139 to $140 a metric ton in the short term.

Steel demand and production in China, the biggest consumer, will remain balanced at about 2.1 million tons to 2.2 million tons a day, because inventory remains relatively high even as iron ore stocks are low, which may result in some “minor” correction in steel output, Chief Executive Officer Neville Power said yesterday in an interview with the Australian Broadcasting Corp.’s ‘Inside Business’ program.

“China looks very strong going forward and we’ve got renewed confidence in the continued industrialization and urbanization growth in China,” he said.

China’s economy is expanding at between 7.5 percent and 8 percent a year, underpinning demand and continued growth in China’s steel industry, Power said. Iron ore may trade between $120 to $130 a ton in the longer term, he said.

“We will have some fluctuations around that and in the short term I see this sort of price level of $139, $140 a ton continuing because there are very low iron ore stocks,” Power said.

Iron ore last traded on April 19 at $138 a ton, according to data compiled by The Steel Index Ltd.

Fortescue shares climbed 9.9 percent to A$3.77 at the close of Sydney trading on April 19, giving the Perth-based company a market value of A$11.7 billion ($12 billion).

To contact the reporter on this story: Soraya Permatasari in Melbourne at soraya@bloomberg.net

To contact the editor responsible for this story: Stanley James at sjames8@bloomberg.net

Please upgrade your Browser

Your browser is out-of-date. Please download one of these excellent browsers:

Chrome, Firefox, Safari, Opera or Internet Explorer.