Iron Ore Market in Brief: Prices again surge above USD90 per MT, after the RRR cut in China
Seaborne iron ore prices rose strongly above USD 90 per MT CFR China on Monday September 9, as the reflection of gains in the futures and steel markets after the Chinese government boosted liquidity in the commercial banking sector.
Commodity | Price | Difference / MT |
MB 62% FE IRON ORE FINES INDEX | USD 92.97 per ton CFR Qingdao | +3.92 USD |
MB 62% FE PILBARA BLEND FINES INDEX | USD 91.71 per ton CFR Qingdao | +3.92 USD |
MB 62% FE IRON ORE INDEX-LOW ALUMINA | USD 90.30 per ton CFR Qingdao | +3.50 USD |
MB 58% FE PREMIUM INDEX | USD 80.47 per ton CFR Qingdao | +0.23 USD |
MB 65% FE IRON ORE INDEX | USD 98.90 per ton CFR Qingdao | +3.10 USD |
MB 62% FE CHINA PORT PRICE INDEX | 742 Yuan per wet metric ton | +2 Yuan |
MARKET DRIVERS
China’s steel futures reacted positively last Friday night to the banking sector’s cut in the reserve ratio requirement. On Monday, the benchmark rebar and hot-rolled coil contracts continued to advance - they ended the day up by 2.3% and 2.8% respectively from Friday’s settlement levels.
The country’s iron ore futures also largely trended upward during the day, closing 1.8% higher than Friday’s settlement. Spot rebar and hot-rolled coil in China traded 20-40 yuan (USD2.80-5.60) per MT higher in the day, with reported trading volumes relatively high for the former.
Spot iron ore trading activity was also robust at Chinese ports although prices were largely rangebound. Seaborne iron ore suppliers made several fixed price offers on platforms and secured two deals at levels that were several dollars higher than estimated prices last Friday.
QUOTE OF THE DAY
“The rebar futures had a strong showing today, in turn lifting most of the futures,” a futures analyst said. “This could be the direct reaction to the bank announcement from last Friday evening
on the reduction of reserves for companies applying for loans.”
PORT PRICES
Pilbara Blend fines were traded around 725-755 Yuan per MT in Tangshan city and Shandong province on Monday, compared with 730-750 Yuan per MT last Friday.
The latest range was equivalent to USD95-99.10 per MT CFR China in the seaborne market.
Report By: Mehrdad Najafi
