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Top Iron Ore Shipper Warns China Is at ‘Peak Steel’

  • Australian government expects mainland production to contract
  • Iron ore prices forecast to decline into $50s next year, 2020
relates to Top Iron Ore Shipper Warns China Is at ‘Peak Steel’
Photographer: Philip Gostelow/Bloomberg
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The world’s largest steel market is about to go into reverse. Production in China will peak in 2018 and then shrink next year as local demand drops, according to forecasts from the Australian government, which says the shift will add to headwinds for core ingredient iron ore.

Mainland steel production is “forecast to peak in 2018,” the Department of Industry, Innovation & Science said in a quarterly report on Tuesday. After topping out at 886 million metric tons, output is expected to drop to 861 million tons in 2019 and hit 842 million in 2020, the department said. Over the same time frame, local demand is seen contracting by 34 million tons.