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eShip Market Trend Monitor

Trend Monitor

Iron ore:  Very firm iron ore demand from China has been a key contributing factor towards increasing global iron ore demand and rising prices since 2018. Improving steel mill margins arising from China’s steel sector supply-side reform have been a key input, with this development seeing its annual crude steel production stabilising at 1.07 billion tonnes in 2021. At the same time, global iron ore supply is lagging this rising demand, most notably from the key supplying regions of Brazil and Australia. This is strongly suggestive of prices remaining tighter than seen in the past, at least until sizeable new production commences out of West Africa. 
 
Grain: High demand currently dominates the grain market. Corn prices are skyrocketing on account of significant sales to China and this is providing additional support for wheat prices, where expected supply is anticipated to fall to its lowest level in the last decade. Over the short term, wheat prices have additionally been bolstered by Russia imposing tougher export prices on their domestic wheat production. At the same time, maize is becoming considerably more expensive, particularly in the US, off the back of rising sales to China that are expected to persist. 
 
Bauxite:  This is the sedimentary rock that houses a relatively high aluminium content. Bauxite refineries produce alumina that is then used to create aluminium metal. Alumina is used for key industrial purposes, for which demand is increasing, principally owing to its combination of superior properties – most notably its low density, non-toxic nature, high thermal conductivity, together with its corrosion resistivity.

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