UBS forecasts a 5% lift in world’s steel production in 2021. This drives a 3% lift in expectations for seaborne iron ore demand and the market is likely to be in deficit, requiring high-cost supply to remain.
As a result, UBS lifts expectations for 2021 average iron ore prices to US$125/dmt and the long-term price to US$65/dmt. The broker upgrades the rating for Deterra Royalties to Buy from Neutral and raises the target to $5.15 from $5.00.
Sector: Materials.
Target price is $5.15.Current Price is $4.34. Difference: $0.81 – (brackets indicate current price is over target). If DRR meets the UBS target it will return approximately 16% (excluding dividends, fees and charges – negative figures indicate an expected loss).
