Iron Ore Market in Brief: Seaborne prices influenced with fall in demand
With the weakening demand due to steel production restriction in North China, seaborne iron ore prices fell on Thursday July 11.
Commodity | Price | Difference / MT |
MB 62% FE IRON ORE FINES INDEX | USD 119.37 per ton CFR Qingdao | -1.59 USD |
MB 62% FE PILBARA BLEND FINES INDEX | USD 119.29 per ton CFR Qingdao | -1.59 USD |
MB 62% FE IRON ORE INDEX-LOW ALUMINA | USD 121.12 per ton CFR Qingdao | -1.26 USD |
MB 58% FE PREMIUM INDEX | USD 109.89 per ton CFR Qingdao | UNCHANGED |
MB 65% FE IRON ORE INDEX | USD 127.10 per ton CFR Qingdao | -1.30 USD |
MB 62% FE CHINA PORT PRICE INDEX | 891 Yuan per wet metric ton | +1 Yuan |
KEY DRIVERS
Uncertainties about market direction at current high price levels, as well as production restrictions on steelmakers in north China, are dampening interest in spot iron ore buying, sources said. The August 62% Fe derivative contract on the Singapore Exchange opened at USD115.50 per ton, but fell to USD113.07 per ton by 6:45 pm.
Some market participants attributed the retreat to worry about administrative measures on the iron ore sector potentially to be carried out by the Chinese authorities following a meeting convened by the Ministry of Industry & Information Technology on Thursday.
In the physical iron ore market, bids on the trading platforms for Pilbara Blend fines were heard at USD115.80 per ton CFR, while offers came in at around USD117.30 per ton CFR. The offers were considerably lower compared with the previous day’s USD120.3-121.50 per ton CFR.
Some market participants said the environmental restrictions on steel-making in North China could be a factor pushing down iron ore prices, because of falling demand from steel mills. Index for iron ore 62% Fe fines fell by USD1.59 per ton, while the daily index for iron ore 65% Fe Brazil-origin fines dropped by USD1.30 per ton.
QUOTE OF THE DAY
“Pollution levels in north China are still not improving, so the authorities [are being] stricter when it comes to the restrictions imposed on mills, so iron ore demand is affected,” a mill source said.
PORT PRICES
Pilbara Blend fines traded at 885-897 Yuan per ton in Shandong province and Tangshan city during the day, compared with 890-900 Yuan per ton a day earlier. The latest price range was equivalent to USD120.90-122.60 per ton CFR China in the seaborne market.
Report By: Javad Najafi
