“Iron ore may decline 8.5 percent this year as global output increases and growth in Asian steel production slows, according to a government forecaster in Australia, the world’s biggest exporter.
Prices may average about $140 a metric ton in 2012 from $153 last year, the Bureau of Resources and Energy Economics said in a report today. Shipments from Australia may climb 12 percent to 493 million tons in 2012, it said.
Steel output growth in China has slowed as the fastest- growing major economy puts greater focus on consumers rather than building projects, BHP Billiton Ltd. (BHP), the world’s biggest mining company, said yesterday. Shares in Vale SA (VALE3), the largest iron-ore producer, fell the most in a week after BHP’s comments. While China’s near-term growth is slowing, iron-ore output significantly lags consumption, Rio Tinto Group (RIO) said yesterday.
“Over the remainder of 2012, iron-ore prices are forecast to ease as production increases from new projects in Australia and growth in Asian steel production weakens,” the Canberra- based bureau said. “Further price decreases are expected to be limited by an expected reduction in exports from India.”
Shares in Melbourne-based BHP dropped for a second day, losing 1.7 percent to A$34.70 in Sydney. Rio Tinto, the second- largest iron-ore exporter, dropped 0.4 percent to A$65.34. Vale, the biggest shipper, fell 0.8 percent yesterday…”
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