Spot Iron Ore prices in China weakens on Monday, fewer big players were interested in buying Iron Ore at these levels over uncertainty in steel prices in China.
Steel prices softened up to 1% last week. Steel industry is going through a sluggish period, with low demand and correcting prices.
Currently spot iron ore prices hovering at $157/Mt for 63.5 Fe cargo, trading on thin volumes
Iron ore prices have stayed above $150 a tonne for about two weeks now, having hit near five-month highs earlier this month, supported by Chinese steel mills rebuilding stocks ahead of winter.
But the pace of buying has slowed because of a uncertain outlook for steel demand. “Iron ore prices have started to soften, and we actually don’t expect any big rise for the rest of the year due to uncertainty over steel prices,” said a senior import official at a steel mill in south-central China.
High interest rates will cut down demand for housing loan, which will result in cut in demand for steel said industry experts. Big steel mills are still operating on thin margins, they will be cautious buying at these levels said trader based in Shangahi.
“I’m not sure if it’s a case of the buying interest just not being there anymore and the restocking has all taken place or if the buying interest is still there, but people are just unwilling to pay up at prices we’re currently seeing. “Maybe the buyers are not driven by that much desperation because demand for steel products still doesn’t seem to be recovering.”
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