Iron Ore Market in Brief: Low port inventory sparks rise in seaborne price
Seaborne iron ore prices maintained their upward trend on Tuesday July 9, but low port inventories prompted concern among market participants..
Commodity | Price | Difference / MT |
MB 62% FE IRON ORE FINES INDEX | USD 121.57 per ton CFR Qingdao | +3.19 USD |
MB 62% FE PILBARA BLEND FINES INDEX | USD 121.49 per ton CFR Qingdao | +3.19 USD |
MB 62% FE IRON ORE INDEX-LOW ALUMINA | USD 123.50 per ton CFR Qingdao | +4.41 USD |
MB 58% FE PREMIUM INDEX | USD 111.85 per ton CFR Qingdao | +3.39 USD |
MB 65% FE IRON ORE INDEX | USD 128.60 per ton CFR Qingdao | +0.70 USD |
MB 62% FE CHINA PORT PRICE INDEX | 903 Yuan per wet metric ton | +21 Yuan |
KEY DRIVERS
The tight supply situation continued to drive seaborne iron ore prices upward, with some market participants believing that this trend was likely to persist in the short term. Meanwhile, some other sources firmly believed that the lower inventory at Chinese ports was a factor behind the higher prices heard.
Chinese port inventories fell to a new low after recording their ninth consecutive drop in the week of June 28-July 4, down by 0.62% to around 115 million tons, a fall of around 718,800 tons, according to industry sources. Demand from Chinese mills was still good, lending support to
seaborne prices and prompting the drawdown of port stocks, a mill source said.
Concerns over supplies have also prompted higher bids on the trading platforms for Pilbara Blend fines, in the range of USD120.70- 122.00 per ton CFR China, but no deals were concluded for the Australian material. The latest known transactions for Pilbara Blend fines on the trading platforms were at USD119 per ton CFR China and USD115.70 per ton CFR China, both on the previous day.
Tuesday was the second consecutive day when the market rallied after plunging last Friday after news broke that the China Iron & Steel Association (Cisa) was forming a stakeholders’ study group to discuss pricing mechanisms for the iron ore markets. Index for iron ore 62% Fe fines rose by USD3.19 per ton, while the daily index for iron ore 65% Fe Brazil-origin fine increased USD0.70 per ton.
QUOTE OF THE DAY
“Mills are still buying iron ore, but most have become more selective in their buying due to the squeezed margins,” a mill source said.
PORT PRICES
Pilbara Blend fines were trading at 905-910 Yuan per ton in Shandong province on Tuesday, compared with 875-885 Yuan per ton a day earlier.
Report By: Parya AhmadPour
