Iron Ore Seen Back at $40 by Morgan Stanley as Seasons Shift
- Bank says seasonal weakness, rising supplies may hurt price
- Winter constraints on Asia’s steel trade seen as ‘profound’
Would an Iron Ore Tumble Save BHP's Future Profits?
This article is for subscribers only.
Iron ore’s 2016 rally may be about to face a challenge from the changing of the seasons. Morgan Stanley has forecast that prices may tumble back to $40 a metric ton this half as the approach of winter in China typically blunts steel demand and output.
“Our short-term forecast still features a September-October seasonal pullback as China’s steel demand and production rate abates,” analysts including Joel Crane wrote in a report. Over the past 10 years, iron ore prices have on average dropped in September, October and November, according to the report.