(Bloomberg) -- Vale SA, the world’s second-largest iron ore producer, sees the Beijing Winter Olympics as the turning point for the steelmaking ingredient. 

Iron ore futures have lost about half their value since mid-July as China limited steel output to contain pollution and power use. Some of those efforts were to ensure clean skies for the Olympics in February, according to Luciano Siani, Vale’s head of strategy and business transformation. 

As a result, prices may continue to weaken heading into the games, before a likely turnaround in the second and third quarters of next year, he told reporters in New York on Monday.

The recovery argument is also supported by signs that Chinese policy makers are already considering measures to encourage growth, Siani said. In addition, supply is constrained, with the La Nina weather phenomenon potentially impacting Australian operations and rain starting earlier in Brazil, he said, while India is set to absorb more of its domestic production. 

“So the second and third quarters, we see good prospects for price because of that,” Siani said. 

Still, he doesn’t see a resumption of the kind of wild swings seen over the last year or so, with prices unlikely to go much below $90 a metric ton or breach the $120 level on the upside.

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