Iron ore prices fell around 6.5% in January to US$125 a tonne, marking an end to a rather unexpected rally that defied expectations of sluggish demand from China.
Prices for the steelmaking ingredient rallied around 30% between August 2023 lows of US$107 a tonne to US$139 a tonne by year end. If the rally extended for one more month – It would have marked one of the longest monthly streaks in history.
But one bad month does not mean the rally is over. Citi analysts believe there are plenty of reasons to remain “tactically bullish” on near-term iron ore prices.
“Iron ore fundamentals could improve post Chinese New Year as mills will resume production supporting iron ore demand,” says Citi.
Alien Metals Ltd (LON:UFO) is a global minerals exploration and development company that will shortly make the transition to iron ore producer. The company was formed from Arian Silver in late 2018, retaining some of the companies more valuable Mexican projects before embarking on an acquisition led strategy, headed up by an excellent geological team and targeted entirely on Western Australia.