Upgrading iron ore price forecasts The absence of steel production cuts and mills light on inventory, especially ahead of a seasonal steel restocking cycle into Chinese New Year, paints a brighter few quarters for iron ore coming up. Our revised numbers now point to a 9Mt deficit in the seaborne export market in 2023, 15Mt surplus in 2024 and 34Mt surplus in 2025. We raise our price forecasts by +6% for 2023 (USD 120/t), +18% in 2024 (USD 106/t) and +13% in 2025 (USD 90/t). We base this on a scenario of China prioritising GDP growth and infrastructure spending, some stabilisation in real estate in 2H24 and the absence of a steel production cap leaving steel exports elevated. See our 2024 Outlook published today. 2024 EBITDA +16%, pricing in lowest iron ore price amongst diversified miners Changes to our iron ore deck are the biggest driver of estimate revisions with 2024 and 2025 EBITDA upgrades of +16% (+5% vs consensus) and +12% (-4% vs consensus). We estimate RIO currently pricing in USD 86/t, more than USD 10/t less than its diversified peers, offering relative value and well below spot at USD 133/t. Mid-single digit dividend yield with strong upside at spot We expect shareholder returns to remain competitive (6% yield average 2024/2025) with upside if iron ore prices sustain above our expectations. Assuming iron ore prices hold at elevated spot levels, the yield could rise to nearly 10%. A 4% yield could be achieved with iron ore down to USD 80/t. Upgrade to Outperform With our revised iron ore deck, and thus EBITDA forecasts, we now see double digit upside in valuation. Oyu Tolgoi ramp-up is progressing well, positive for group ambitions to double copper production by the end of the decade, although iron ore will remain 50% of EBITDA through that period. Upgrade to Outperform (from Neutral) with TP of 6,500p (prior 5,880p).