Supply will exceed demand by 17 million tons this year, said Ding Shouhu, deputy manager of raw material purchasing atBaoshan Iron & Steel Co, in a slide presentation at a MetalBulletin Plc conference in Perth.
Supply will grow by another 92 million tons next year, according to his slides. Iron ore prices jumped a record 71.5% this year, led by surging Chinese demand.
Iron ore suppliers such as BHP Billiton and Japanese steelmakers start formal negotiations in December, setting global benchmark for European and US steelmakers such as Mittal Steel Co and Arcelor SA.
China may increase iron ore imports by 25% to 250 million metric tons this year, the government said. China's steel production is growing at its fastest pace in at least nine years.
Crude steel output may reach 340 million metric tons in 2005, according to a Bloomberg News analyst survey.