Issue 36, 2023 - This week's editorial: Iron ore price outlook remains strong for 2023

BMI, a unit of Fitch Solutions, has maintained its 2023 iron ore price forecast at an annual average of $110/tonne, with strong risks to the upside.

BMI says in a note that the iron ore price resilience continues from positive sentiment, falling Mainland Chinese port inventories, and strong demand from the country's non-property sectors including machinery, shipping, autos, and infrastructure.

Despite Mainland China's uneven economic growth and a still failing property sector, the note adds that blast furnace steel production and thus iron ore demand have shown defiance, through support from non-property sectors including shipping, machinery, autos and infrastructure.

BMI goes on to say that outside of China, steel production and demand for iron ore are starting to show signs of recovery. On the supply side, major iron ore miners posted strong production growth in FY2022 and announced positive guidance for 2023, which will work to limit the upside for iron ore prices.

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