The price collapse of %IronOre is now threatening %Mining operations around the world.
Multiple media reports say mine operators from Canada to Australia are sounding the alarm after the price of iron ore, a key ingredient in steelmaking, fell below $90 U.S. a ton in Asian trading.
Global mining giants such as %RioTinto (NYSE: $RIO) in Australia and Brazil’s Vale SA (VALE) say that the price collapse is calling into question the viability of operating high-cost mines.
The price of iron ore has fallen 8% in the last month and is down 35% since the end of 2023, mainly due to waning demand for steel products in China.
Iron ore prices are now at their lowest level in nearly two years as China’s steel demand craters amid a widening economic slowdown in the nation of 1.4 billion people.
Now, major mining companies say they are discussing whether to close mines to better align supply with global demand.
Analysts say iron ore mines could be closed in coming weeks in countries such as India, Brazil and Mongolia, with Canada and Australia not far behind.
China remains the world’s biggest buyer of iron ore, importing nearly 1.2 billion tons for steelmaking in 2023.
However, demand for steel in China has ground to a halt as the country also grapples with a debt crisis in its property market.
Some analysts warn that China’s steel demand has likely peaked and that a sharp slowdown in demand for iron ore can be expected in coming months.
Current estimates say that there is about 150 million tons of iron ore sitting in Chinese ports, the highest amount on record.
