Iron Ore Market in Brief: Seaborne prices rise further, high grades do best
Seaborne iron ore prices continued to rise on Friday April 12, with high-grade materials such as Iron Ore Carajas (IOCJ) continuing to outperform other grades.
KEY DRIVERS
A Capesize cargo of Pilbara Blend (PB) fines traded via a miner’s tender on Friday at a fixed price around USD 1.00-1.50 per ton higher than market participants’ estimated levels a day earlier, while two Capesize shipments of IOCJ fines were sold at fixed prices that were USD 1.95-2.45 per ton higher than a transaction price on Thursday. The return of spot tenders for PB fines could signal that port operations and logistics in Western Australia have recovered after being affected last month by Cyclone Veronica, a China-based trader told.
Meanwhile, the bigger increase in prices for IOCJ could still be riding on expectations of tighter supply later, due to a reduction in shipments from north Brazil in recent weeks, as well as improving steelmaking margins in China. Spot trading on IOCJ at Chinese ports was also very active during the day, sources said, with prices rising by 5-10 Yuan (USD 0.74-1.49) per ton.
In comparison, mid and low grade iron ore changed hands at range-bound prices at Chinese ports during the day.
Thanks to revived market interest in high-grade materials, trading activity also turned upward for iron ore pellets and concentrate this week, according to sources. Separately, China imported 86.42 million tons of iron ore in March, up by 0.7% year on year and by 4% month on month,
according to the country’s preliminary customs data. Imports totaled 260.79 million tons in the first quarter, down by 3.5% from a year earlier, it said.
62% Fe Iron Ore Index rose by $0.82 per ton on Friday, while the corresponding 65% Fe Iron Ore Index increased by $2.20 per ton.
QUOTE OF THE DAY
“IOCJ shipments for Chinese mills’ term contract volumes could have been postponed by at least 15 days due to the rains in north Brazil. This, plus the quickly widening steelmaking profits in China, has pushed high-grade iron ore back under the spotlight,” a trader in Beijing said.
Report By: Mehrdad Najafi
