Jan. 21 (Bloomberg) -- Vale SA, the world’s largest iron-ore producer, considers a drop in the metal price in China as “transitory” because the Asian country’s economic fundamentals are solid, the chief executive officer said.
“Chinese steelmakers are working with lower levels of inventory now because the credit is not available as it was,” CEO Murilo Ferreira told reporters today in Brasilia. “But this is a transitory position.”
Iron ore futures for May delivery on the Dalian Commodity Exchange slid 1.6 percent to close at 847 yuan ($140) a ton today, the lowest since the contract’s Oct. 18 debut. Vale slid 2.4 percent in Sao Paulo trading today to 28.48 reais.
Goldman Sachs Group Inc. said in a Jan. 20 report that iron ore is moving into oversupply this year, with prices seen falling to $108 a ton in 2014 and $80 a ton in 2015.
To contact the editor responsible for this story: James Attwood at email@example.com