Citi: Iron Ore Cost Support at $85, High-Cost Producers Under Increasing Pressure

Cost Support Level

In an August 4 report, Citi said the key cost support level for the iron ore industry is around $85 per tonne, at which about 6% of seaborne supply faces curtailment risk or would generate only low single-digit margins. Citi estimates the industry breakeven price at $66 per tonne, up 7% from the last update in May 2025, showing that producer breakeven costs continue to climb.

Rising Breakeven Price

Citi said that although major Australian and Brazilian producers maintain healthy margins, high-cost producers face increasing profitability pressure. Citi holds a neutral view on near-term iron ore price trends, with a 0-3 month price forecast of $100 per tonne.