Iron ore fell below the 60 mark for the first time in 5 years

In the context of the price of iron ore falling below the $60 mark per tonne for the first time in more than five years, the mining giants are still stepping up production, putting pressure on the market.

On the 5th, the 62% grade-related iron ore index closed at a price of $59.75 per ton, fell by $3 a week, and fell below the $60 per ton mark for the first time in more than five years. The main iron ore contract ** contracted, the spot transaction price also fell, the market trading was light.

In the case of such a weak price, the iron ore giants did not stop production "step." According to media reports, BHP Billiton set the current fiscal year's production target to 225 million tons, compared with 204 million tons in the previous fiscal year. Rio Tinto plans to produce 330 million tons this year, compared with 295 million tons in 2014. Vale is expected to produce 340 million tons. The output of these three major miners accounted for about 57% of global exports last year.

The three big companies invested billions of dollars to raise low-cost production, trying to stimulate sales and forcing uncompetitive competitors to close. The analysis pointed out that the production cost advantages and scale advantages of the four major international mines are still very obvious. Therefore, they have continued to expand production enthusiasm in the case of large-scale investment in the previous period.

Morgan Stanley expects this year's net increase will be 63 million tons, and production is expected to peak in September to October.

Prior to this, several international authoritative organizations predicted that the ore price will fall in 2015, and Citibank expects that the iron ore price will drop to US$58 per ton in 2015.

However, Huatai Great Wall Research reported that, although this round of mineral prices has fallen below the previous key support of 60 US dollars, but the market is not much to empty the sound. The seasonal start-up recovery is expected to be postponed to the end of March, and the bears are more alert to possible start-ups and production recovery. At present, the stock of finished steel products is high, but at the end of raw material stocks, if demand starts to pick up production, the intensity of mine price rebound will also be not small.