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[Ferro-Alloys.com]Supply disruptions from Russia and Ukraine may push the iron ore market into deficit in 2022, analysts at Bank of America said in a note.
Russia and Ukraine churn out around 107 million tonnes and 77 million tonnes of iron ore respectively, annually, and between them account for 8% of global production.
Meanwhile, the two countries account for 4% of seaborne supplies.
“The contribution of Russia and Ukraine to the global market is relatively small compared to that of the two largest producers, Australia and Brazil. Yet, this does not mean that iron ore is immune to any disruption,” said BofA.
“Indeed, moving into 2022, our base case assumption was for only a 5 million tonnes surplus, so, in essence, a more or less balanced market. With some supply losses increasingly likely, iron ore may be in deficit also this year.”
Price volatility, rally
Iron ore prices have been volatile, falling by 57% in autumn last year, before rallying 70% between November and February.
According to Fastmarkets MB, benchmark 62% Fe fines imported into Northern China were changing hands for $157.20 a tonne on Thursday, down 1% compared to Wednesday’s closing. (mining.com)
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