Analysts may cut iron ore price forecast to $ 30 per ton

Marine supplies of iron ore dipped below $ 50 per tonne and analysts are likely ready to cut their forecast in the coming weeks to a new low of $ 30 per tonne.

Based on the verbal skirmish of the miners, it became abundantly clear that the Big Three are not going to reduce the volume of iron ore production. A huge oversupply and slowing demand in China have hit iron ore prices hard since the last peak of $ 140 per tonne in June 2013. Now spot prices for Australian-origin raw materials are down 62.5 percent to less than $ 55 per tonne CFR China.

China's new economic growth rate, constrained steel demand amid huge unused production capacity and low prices have been creating chaos in the iron ore market for quite some time. However, the gap between supply and demand is widening every week as the Big Three iron ore miners remain committed to their mega-investment in mining over the past 4-5 years.

Initially, the mismatch between supply and demand for iron ore was underestimated by most analysts, but recently they have become aggressive in forecasting by constantly downgrading their data. On March 17, Australia's Industry Department set the price at $ 60 per tonne; March 19 Argonaut Securities - $ 40 per ton; March 23 Citi Group - $ 50 per ton; March 24 Morgan Stanley - $ 55 per ton. But at the end of March, the shock came with the conclusion of analysts that the iron ore industry would face a tipping point below $ 30 per ton if output continued to rise.