Iron Ore Market in Brief: Rise in seaborne prices with the buying activity revived
Seaborne iron ore prices edged up on Monday June 10 amid positive buying activity and gains in the futures markets.
Commodity | Price | Difference / MT |
MB 62% FE IRON ORE INDEX | USD 101.51 per tonne cfr Qingdao | +0.918 USD |
MB 62% FE PILBARA BLEND FINES INDEX | USD 100.31 per tonne cfr Qingdao | +0.91 USD |
MB 62% FE IRON ORE INDEX-LOW ALUMINA | USD 105.20 per tonne cfr Qingdao | +1.16 USD |
MB 58% FE PREMIUM INDEX | USD 92.61 per tonne cfr Qingdao | +1.75 USD |
MB 65% FE IRON ORE INDEX | USD 116.10 per tonne cfr Qingdao | +0.80 USD |
MB 62% FE CHINA PORT PRICE INDEX | 763 yuan per wet metric tonne | +3 Yuan |
KEY DRIVERS
China’s iron ore futures recorded gloomy performance on Monday morning, but they experienced some advance in the afternoon. The benchmark September contract ended the day 3.2% higher than the settlement level on Thursday June 6, the last trading day before the country’s long weekend for the Dragon Boat Festival. This boosted physical market sentiment and led to higher offer and transaction prices at Chinese ports.
In the seaborne market, a number of Capesize shipments of Pilbara Blend fines was heard to have traded at the July average of a 62% Fe index at a premium of USD2.60-2.80 per ton, higher than a traded premium of $USD2.50 a week ago. A miner sold an Australian cargo of Mining Area C fines at a fixed price equivalent to just above USD100 per ton CFR China, market participants said.
Some sources attributed the stronger prices and premiums to an expected move closer to port price levels, which are currently higher than in the seaborne market, whereas others believe it is to do with fewer July-loading cargoes being available in the market. Such scarcity could stem from some planned maintenance work by Australian miners in July, which is the start of the financial year for some of them.
China imported a total of 83.75 million tons of iron ore in May, down 11% year on year, although 3.7% higher than in April, according to preliminary Chinese customs data. Imports in the first five months of 2019 totaled 423.92 million tons, 5.2% down on the same period in 2018. Daily MB 62% Fe Iron Ore Index rose USD0.91 per ton, while the daily MB 65% Fe Iron Ore Index increased USD0.80 per ton.
QUOTE OF THE DAY
“With high capacity utilization rates, Chinese mills still have good demand for low-alumina iron ore. This may linger until their profitability is squeezed out,” a trader in east China said.
Report By: Encieh Arbabi
