In Mar’16, global iron ore prices witnessed a roller coaster ride. After a sudden increase in prices of USD 12/MT in a day, prices are again back at USD 54/MT by the end of the month.
Spot iron ore prices remained range bound and it is expected that in April, prices will not be lower than in March, because steel mills in China are still making good profit upon pick up in seasonal constructional demand.
Market drivers of the month
1.Starting Mar’16, there was sharp increase of USD 12/MT in global iron ore prices in a day. Prices touched to a level of USD 62.6 /MT, CFR China on 07 Mar’16, which was at USD52/MT, CFR China on 04 Mar’16. However, by the end of Mar’16, prices again touched to a level of USD 54/MT, down by USD 9/MT.
2. Upon sharp increase in global iron ore prices, export offers for Indian iron ore fines Fe58/57% were assessed at USD 42-44/MT, FoB India where export duty is zero. Alongside, current offers are at USD 33-34/MT FoB, India where as such no trade had been seen yet.
3. Gina Rinehart Roy Hill’s inaugral shipment of iron ore carrying 177,300 MT iron ore (containing low phosphorous) is about to reach China this week.
4. Iron ore inventories at major Chinese Port was recorded at 97.6 MnT (as on 25 Mar’16).
5. Shanghai rebar prices are at eight months high at USD 340/MT. Chinese steel prices have moved up as steel producers have increased their production due to increase in constructional activities
6. Market participants are still optimistic about iron ore market that iron ore prices will again touch to a level of USD 60/MT, as seasonal construction activity still persist.
7. There is an ongoing “International Horticulture Expo” in Tangshan China (a major steel producing city in Hebei province). During this expo (starting 29th Apr’16 to 16 Oct’16), the steel mills in Tangshan will go production cuts contributing environmental friendly region in Hebei.
8. In Nepal’s largest iron ore reserves of around 8 MnT was found in Nawalparasi. This is Nepal’s largest iron ore mines.
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