• Industry: Metals & Mining
  • Type: Publication series
  • Date: 8/10/2012

Quarterly Commodity Insights Bulletin: Iron Ore (Q2 2012) 

KPMG's Global Commodity Insights Bulletin on iron ore provides an overview of recent global events and outlook for that commodity, details of major developments and projects, and recent regulatory changes.

Key insights

  • Spot price of iron ore (62 percent Fe content) in China oscillated between US$130/t-145/t during Q2 2012, to average US$139.51/t.
  • Global market for iron ore is expected to tighten in the second half of 2012. Prices are expected to remain stable in 2012, to an average of US$143/t.
  • Production and exports of iron ore from India are expected to decline due to restriction on illegal mining and impact of monsoon. 
  • The Chinese government is expected to launch pro-growth initiatives to boost steel demand.
  • Medium term, growth in supply is expected to outpace growth in demand, due to mine expansions and increased production capacity in Australia, Brazil and West Africa.
  • According to BREE, 35 greenfield and 13 brownfield iron ore projects are at the feasibility or advanced development stage  in Australia and expected to commence production over the next 5 years.
  • 15 projects are at the advanced stage of construction and are expected to add 254Mt over the next 3 years; the remaining projects are expected to add another 322Mt by 2017.