Iron ore prices could fall 25 per cent

S&P Global Ratings Credit Analyst Richard Creed Global says steel production is declining due to weak demand from China, prompting major iron ore producers like BHP and Fortescue to diversify into energy transition commodities like copper.

Despite production increases in emerging economies, such as India, they cannot fully offset China’s significant steel output decline, driven by a downturn in the housing sector.

“It’s really plateauing, we think,” Mr Creed said.

“We would expect lenders to be having a careful look at their portfolios and who they’ve got exposure to in the coming years.”