After a spike in fuel prices propped up iron ore prices in recent months, an interim peace deal in the Middle East has shifted the market’s focus back to the fundamentals, including seasonally weak demand and rising supply of Australia’s key export.
Iron ore prices held above the key psychological level of $US100 a tonne between March and June after the US-Iran war triggered a spike in diesel prices. The Australian Mineral Economics (AME Group) estimated that the so-called free-on-board costs, which form part of the price of iron ore, rose between 5 per cent and 20 per cent in March and April.
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