Iron Ore Market in Brief: Another jump to over USD110 on the bullish trade
Seaborne iron ore prices soared across the USD110 PMT CFR mark again on Tuesday June 18 after a dip on Monday, amid bullish trading in derivatives and physical markets.
Commodity | Price | Difference / MT |
MB 62% FE IRON ORE INDEX | USD 112.28 per ton CFR Qingdao | +4.07 USD |
MB 62% FE PILBARA BLEND FINES INDEX | USD 111.08 per ton CFR Qingdao | +4.07 USD |
MB 62% FE IRON ORE INDEX-LOW ALUMINA | USD 114.46 per ton CFR Qingdao | +3.71 USD |
MB 58% FE PREMIUM INDEX | USD 102.97 per ton CFR Qingdao | +3.30 USD |
MB 65% FE IRON ORE INDEX | USD 123.30 per ton CFR Qingdao | +1.60 USD |
MB 62% FE CHINA PORT PRICE INDEX | 817 Yuan per wet metric ton | unchanged |
KEY DRIVERS
China’s iron ore futures have moved moderately higher since a retreat in the first half of the night session on Monday, and they posted a sharp spike in the last 30 minutes of the day session on Tuesday. The benchmark September contract ended the day 2.1% higher than Monday’s settlement level. Strong spot iron ore prices and the backward-ation of futures prices have been supporting the latter, an analyst in Shanghai said.
A July-loading cargo of Australian 62% Fe Newman fines changed hands at a fixed price of USD111 per ton CFR China in the afternoon, while the July contract of 62% Fe iron ore derivative on the Singapore Exchange also advanced by about USD4 per ton from a day earlier. Bids were also seen made at steady levels for July-loading Australian Pilbara Blend fines on platforms.
At Chinese ports, transactions for PB fines in the morning were heard at prices lower than on Monday, but prices returned to the highest Monday levels in the afternoon in line with futures gains. Meanwhile, intensifying profitability pressure on Chinese steelmakers has continued to drive them away from costly iron ore brands to lower-priced materials, for example some
non-mainstream lower grade products.
Daily MB 62% Fe Iron Ore Index rose by USD4.07 per ton, while the daily MB 65% Fe Iron Ore Index increased by USD1.60 per ton.
QUOTE OF THE DAY
“Fears of supply tightness in July seem to still be driving iron ore prices up for various low and middle grade products,” a China-based mill source said.
Report By: Encieh Arbabi
