[themoneytizer id="51423-1"]
English

Demand for iron ore will trend downward

The BHP Group highlighted that the demand for iron ore in the world is expected to stabilize in the medium term before trending downwards due to the decrease in demand from China.

The stagnation of steel demand and the increase in the proportion of steel scrap in China will translate into lower demand for iron ore in the long term.

Despite the projected demand from developing countries (from a low starting point), this will not be sufficient to offset the decline in demand in China.

Wood Mackenzie expects global seaborne imports to stabilize over the 2020-2025 period, with the decline in Chinese imports from the peak offset by widespread growth and recovery outside China.

During the decade after 2025, seaborne demand will follow a slight downward trend, with a compound annual growth rate (CAGR) of -0.8%, and Chinese demand will continue to decline at a rate of -1.7% CAGR, while ex-China demand would grow at a CAGR of 1.0% during the same period.

In the long term (2035-2050), seaborne demand is expected to continue to decline at a rate of around -0.3% per year, with Chinese demand falling -1.2% while ex-China would grow +1.1%, in both cases considering a CAGR.

Iron ore is the main raw material for iron and steel manufacturing, which is an important element for construction, transportation, energy infrastructure and household appliances.

Iron ore demand

World crude steel production has more than doubled over the past two decades, from 850 billion tons in 2000 to 1.95 billion tons in 2021 (source: World Steel Association), to fuel global economic growth, urbanization and industrialization.

During the same period, China’s production has increased from 131 Mt in 2000 to 1,033 Mt in 2021, contributing to most of the global increase.

Of the 2.3 billion tons of total iron ore consumption in 2021 worldwide, 1.5 billion tons are traded in the seaborne market.

Asia is the largest customer, with 90% of seaborne iron ore demand, with most seaborne iron ore going to China, Japan and South Korea.

China is the largest customer, with more than 70% of seaborne iron ore demand.

 

Redacción Opportimes

Publicidad
loading...
[themoneytizer id="51423-1"]
Mostrar más
Botón volver arriba