Wednesday, December 08,
Spot iron ore prices in China remains stable with tight supplies and firmer steel prices. Offers to sell Indian ore with 63.5 percent iron content stood at $171-173/MT, cost and freight delivered to China.
But market appetite could wane, with some traders becoming hesitant to make forward bookings as Chinese steel mills were cautious in accepting prices higher than $170 per tonne.
“Some steel mills are struggling to produce flat steel products, given high raw material costs and they have been very cautious on prices and have not been buying too much forward shipment,” said an official in charge of buying iron ore for a medium-sized steel mill.
The most active May rebar futures in the Shanghai Futures Exchange rose to a near one-month high of 4,771 yuan per tonne on Tuesday, before easing slightly on Wednesday.
The Steel Index 62 percent iron ore benchmark slipped $2.40 to $164.70 a tonne on Tuesday, but not far off the 6-1/2-month high of $167.80 touched last week.
Prices for forward swaps continued to trend higher as investors remained bullish about the outlook for 2011.
The January contract cleared by the Singapore Exchange gained 56 cents to $170.5 per tonne and the February contract jumped $1.12 to 168.62 per tonne.
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