Vale (VALE) -2.3% in Thursday’s trading as Scotiabank downgraded the Brazilian iron ore producer to Sector Perform from Sector Outperform with a $15 price target, believing the iron ore market may face downward pressure as more supply comes from top producers and the new Simandou mine in Guinea, which is now ramping-up.
Scotiabank’s Alfonso Salazar also sees downside risks to iron ore demand if the decline of steel
consumption in China accelerates, as new stimulus for infrastructure and real estate may be
limited due to China’s high debt levels.
Against a backdrop of continued demand contraction in China, Salazar said global steel demand stability is starting to look more like a best case scenario, which does not bode well for the surprisingly resilient iron ore price, projecting the benchmark price to decline to $90/ton in H2 2026.
Vale (VALE) shares jumped 53% in 2025, and the analyst thinks the rally may be set to pause, prompting investors to look for a better entry point later in the year, as the stock continues to offer one of the most attractive valuations among mining companies.