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.
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- 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.