Iron ore prices unlikely to match last year\'s high

Iron ore prices are unlikely to match last year\'s highs as steel use grows at the slowest pace in three years amid concerns a faltering global economy will curb demand from Europe to China, the world\'s biggest steelmaker. \"Steel production this year is going to be a little softer than we saw last year,\" said Natalie Robertson, an analyst at Australia & New Zealand Banking Group. Ore prices \"won\'t be as high as last year\". \"Last year we felt it was at unusually high levels,\" she said. Global steel use will rise 4.5 per cent this year, less than the 5.4 per cent forecast in October by the World Steel Association, and may be as low as 1.2 per cent, according to a Bloomberg survey. The gain, the lowest in three years, may be tempered by cooling economies in China and Europe, where orders for steel products for homes, cars and machinery are stagnating and will keep the alloy\'s prices and overseas shipments muted. Base case Article continues below \"Our base case is Chin-ese steel growth is going to slow from the 8 per cent to 10 per cent range they\'ve been running at over the past few years,\" said Daniel Hynes, a director of commodity research at Citigroup in Sydney. \"We\'re looking at 3 per cent growth this year.\" Steel production in China, which accounted for about 46 per cent of the global total in 2011, fell in each of the six months through November before gaining in December, according to the World Steel Association, the Brussels-based trade group that promotes the steel industry. China\'s steel industry will face a \"grimmer\" test in 2012 on reduced demand and rising costs of fuel and iron ore, Zhu Hongren, spokesman and chief engineer for the Ministry of Industry and Information Technology said at a briefing in Beijing on Monday. Slowdown The nation boosted annual steel output by the slowest pace in three years in 2011 as its economy cooled last quarter, cutting demand. China\'s crude steel production gained 8.9 per cent last year to a record 683.3 million tonnes, the National Bureau of Statistics said on January 17. Annual production gained 10 per cent in 2010 and 13 per cent in 2009, after climbing 2.3 per cent in 2008, according to the China Iron and Steel Association. The World Bank on January 18 cut its global growth forecast by the most in three years, saying a recession in the euro region threatens to exacerbate a slowdown in emerging markets.