Iron Ore Market in Brief: More rise in prices of Australian products
Physical prices for Australian iron ore continued to rise on Friday June 14.
Commodity | Price | Difference / MT |
MB 62% FE IRON ORE INDEX | USD 110.30 per tonne cfr Qingdao | +0.14 USD |
MB 62% FE PILBARA BLEND FINES INDEX | USD 109.10 per tonne cfr Qingdao | +0.14 USD |
MB 62% FE IRON ORE INDEX-LOW ALUMINA | USD 114.21 per tonne cfr Qingdao | -0.29 USD |
MB 58% FE PREMIUM INDEX | USD 101.74 per tonne cfr Qingdao | +0.56 USD |
MB 65% FE IRON ORE INDEX | USD 123.70 per tonne cfr Qingdao | -0.80 USD |
MB 62% FE CHINA PORT PRICE INDEX | 827 yuan per wet metric tonne | +24 Yuan |
KEY DRIVERS
China’s iron ore futures continued to advance on Thursday night after a spike before the close of the day session, but they retreated on Friday afternoon to erase most of the gains. Spot iron ore trading at Chinese ports was generally less active than on Thursday, but transaction prices were said to have risen by as much as 30 Yuan (USD4.34) per ton day on day for Pilbara Blend (PB) fines from Australia.
Demand for seaborne shipments of PB products also stayed robust, with July-index-linked Capesize cargoes of PB fines heard traded at a premium of USD4-4.50 per ton on Friday, up from USD3.80-4 per ton a day earlier. Bids for joint shipments of PB fines and lump were also heard at a premium of USD4.50 per ton.
Premiums for other mainstream 62% Fe Australian fines also continued to increase, with a cargo of Jimblebar fines heard at a premium of USD1.30 per ton, up from USD0.45-0.50 per ton on Thursday. Australian miner BHP has set the discounts of zero, based on 62% Fe indices, for third-quarter term contract shipments of its 61% Fe Mining Area C fines and 57% Fe Yandi fines. And its discount for its 60.3% Fe Jimblebar fines has been set at 0.5%.
The previous discount on Mining Area C and Yandi fines was 3% previously, while the discount on Jimblebar fines was 6% for the current quarter, according to sources. Port stocks of iron ore in China continued to descend amid still-high consumption by steelmakers. Iron ore inventories at 45 major Chinese ports totaled 117.96 million tons as of Friday, down 3.63 million tons from last Thursday and 24.92 million tons lower than at the start of 2019, according to a local data provider.
China produced 72.19 million tons of pig iron in May, up 6.6% on the year, according to China’s National Bureau of Statistics. January-May output totaled 335.35 million tons, 8.9% higher than a year earlier. Daily MB 62% Fe Iron Ore Index rose USD0.14 per ton, while the daily MB 65% Fe Iron Ore Index decreased USD0.80 per ton.
QUOTE OF THE DAY
“The cost-effectiveness of PB fines recognized by Chinese mills, coupled with expectations of fewer shipments in July and August, has led to the jump in prices and premiums of the product and similar Australia ore,” a trader in Shanghai said.
Report By: Parya AhmadPour
