Offers for Spot Iron ore remained almost at the same level on
Thursday, with buyers still shying away from the market. Indian fines Fe
63.5/63 stays at $148-149/MT. Whereas, offers for Australian 61.5-percent grade
Pilbara iron ore fines went down by $1 to reach at $142-$144/MT.
In China's domestic spot market, cargoes are being sold at 10-20
yuan per tonne less than the offer price, a Shandong-based trader said, adding
some sellers were opting to unload material with “little or almost no
margin at all.”
Some traders are also finding it hard to sell iron ore held in
Chinese ports, some of which was bought at high prices. “We still have
about 200,000 tonnes of port stocks, some of them we bought in October and
November and the current price is still about $7 to $8 lower than our purchase
price,” said a trader in Shanghai.
Reflecting market expectations that spot rates could slip further,
prices of iron ore swaps extended losses on Wednesday, with nearby contracts at
a discount to index-based prices.
However, BHP Billiton, the world's no. 3 iron ore miner, believes
that the fundamentals for iron ore demand remain strong, with Chinese steel
making expected to pick and with Indian iron ore supplies lagging expectations.
“Going forward, the fundamentals remain strong in the
short to mid term for iron ore demand,” said BHP's Chief Marketing Officer
Mike Henry.
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