Iron ore is going to be cheaper for the ninth consecutive week, which would be the longest losing streak for the metal than 7 years. This happens before Saturday to be published data on the production of steel in China, which are expected to show further weakening in demand, writes Bloomberg.
Ore with 62% metal content delivered in Qingdao, cheaper by 3.8% this week, falling to a price of 38.52 dollars per tonne on Thursday. Daily price is the lowest since May 2009 NASA data show Metal Bulletin Ltd.
The raw material is directed to its longest losing streak since October 2008, after the supply increases, according to weekly data of more Metal Bulletin.
Since the beginning of the year, iron ore has dropped by 46% due to rising production of the biggest mining companies, among which Vale SA in Brazil and BHP Billiton Ltd. and Rio Tinto Group in Australia.
While China is about to record the slowest economic growth since 1990, as the government tries to reduce the dependence of the economy from heavy industry, which nakaryanva demand for steel, cement and coal. Data on industrial production, which is expected on Saturday, will likely show a subsequent decline in steel production.
Demand for steel from China declined for the first time in decades. The index of purchasing managers in the steel industry fell to 37 points in November from 42.4 points in October. Value of the index below 50 points to contraction testify.