Iron Ore Market in Brief: Seaborne prices tumble amid restrictions in North China
Seaborne iron ore prices fell across the board on Monday July 22, amid environmental restrictions imposed on steelmakers in north China.
Commodity | Price | Difference / MT |
MB 62% FE IRON ORE FINES INDEX | USD 118.33 per ton CFR Qingdao | -3.46 USD |
MB 62% FE PILBARA BLEND FINES INDEX | USD 118.25 per ton CFR Qingdao | -3.46 USD |
MB 62% FE IRON ORE INDEX-LOW ALUMINA | USD 119.33 per ton CFR Qingdao | -3.48 USD |
MB 58% FE PREMIUM INDEX | USD 107.49 per ton CFR Qingdao | -1.93 USD |
MB 65% FE IRON ORE INDEX | USD 126.80 per ton CFR Qingdao | -2.40 USD |
MB 62% FE CHINA PORT PRICE INDEX | 893 Yuan per wet metric ton | -3 Yuan |
KEY DRIVERS
Market players were cautious on Monday, with buying interest still limited by looming environmental restrictions in north China focused on sintering activities. The government asked local steel mills to suspend 50-70% of the operations of sintering machines on July 21-25, and to suspend whole operations of sintering machines and blast furnaces on July 26-28, according to an official document distributed on July 20.
However, the government said that several companies it classed as excellent in terms of environmental protection need only limit 20% of sintering machine operations during the whole period, these steelmakers include Tangshan Heavy Plate Co and Delong Steel. The tighter restrictions are now having an impact on iron ore futures and spot prices, sources said. However, given the short duration, the market impact is unlikely to be too heavy, a trader in Beijing added.
Meanwhile, iron ore futures contracts on the Singapore Exchange (SGX) also weakened. The August and September contracts for the 62% Fe derivative on the Singapore Exchange fell by USD2.40-2.70 per ton, compared with last Friday’s closing price. Index for iron ore 62% Fe fines fell by USD3.46 per ton, while the daily index for iron ore 65% Fe Brazil-origin fines decreased USD2.40 per ton.
QUOTE OF THE DAY
“The [iron ore] market really took a beating today - restrictions in Tangshan seem to be affecting it, sending across bearish sentiment,” a Chinese mill source said.
PORT PRICES
Pilbara Blend fines traded at around 880-897 Yuan per ton in Shandong province and Tangshan city during the day, compared with 890-908 Yuan per ton last Friday. The latest price range was equivalent to USD120.20-122.60 per ton CFR China in the seaborne market.
Report By: Encieh Arbabi
