Vale’s Cut Is No Panacea for Iron Ore, Morgan Stanley Says
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Iron ore prices trading near the lowest level since at least 2009 will probably remain under pressure and may even extend declines after Brazil’s Vale SA announced changes to production plans, according to Morgan Stanley.
The world’s biggest producer said on Monday that it would cut about 25 million metric tons of higher-cost supply from this month, while sticking to a full-year output target of 340 million tons. The decisions are a recognition that the market is oversupplied this year and will probably remain in surplus in 2016, according to Executive Director Peter Poppinga.