Global iron ore prices have climbed to USD3/MT post Chinese Lunar New Year holidays. Prices are assessed at USD 47/MT, CFR China on 19 Feb’16.
There is little bit of tightening of steel supply in the market which have allowed steel prices to inch up, that has given more room to steel mills for purchase of more iron ore. Post holidays, Shanghai rebar prices have also moved up along with iron ore, and touched a near five month high at USD 290/MT.
This sudden increase in prices have clearly shown that iron ore is making a quiet come back. As, we have mentioned earlier, iron ore prices have gained almost three months high since Nov’15, as steelmakers in China boosted purchases of raw material after Chinese New Year and steel prices are firm.
Market analysts anticipates that this price rally wouldn’t last long, as is still oversupplied market.
On the other side, Brazilian miner Vale had recently released strong operational review of 2015. The country produced around 345.9 MnT iron ore in 2015, more that the annual production guidance.
Currently, the global market have become optimistic as iron ore and steel demand in China in coming weeks may improve as construction activity improves after winter. Still, there is merely expectations, that weather this price rally will sustained as there is a factor underlying named “The Global Glut” by major miners will pressurize the iron ore prices in future.
Trade wise:
- Few sellers halted their offers in seaborne market amid expectations of higher prices
- BHP Biliton sold 90,000 MT of Fe 62.7% Newman fines at USD48.2/MT CFR.
- A deal of 135,000 MT Fe 65% iron ore for April arrival from Carajas concluded at USD 52/MT CFR.
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