December 03, 2008

Iron ore shortage may turn to glut in next decade - Analyst

AAP reported a global glut of iron ore may be expected next decade as supply could exceed demand.

Mr Alan Heap managing director of Citi Investment Research during a conference in Perth said that “Next decade, large surpluses are looming as supply exceeds even our bullish expectations for demand.”

Mr Heap said that the iron ore market would remain tight throughout 2008, supporting another price rise next year in addition to the expected 65% hike expected this year.

He said that Australia’s iron ore exports are expected to reach 450 million tonnes by 2010 and 700 million tonnes by 2014. He added that “There is potential to exceed forecasts if projects go ahead as planned.”