Wednesday, October 13,
The overall tight supply of high grade material from India has led to continuous increase in Spot Iron ore prices. A 63/63Fe Indian tender was heard to close as high as $160/MT CFR yesterday and the port material for 63.5Fe rose to 1190-1200 RMB/MT. As a result, TSI index moved up by more than $2 to reach $150.2.
There are mixed views in the market as some traders are concerned if price could sustain at such high levels. And an unexpected price freeze by Bao Steel signals that other players in the world’s biggest steel sector are likely to show similar caution for the rest of this year as oversupply continues to bother the market.
“Traditionally demand would fall in the winter season, and traders are facing tighter credit, which usually causes steel prices to stay weak. We might follow with cautious moves toward adjusting prices as we believe the Chinese steel market will continue to be oversupplied due to faltering exports and resuming output,” said a senior official from Anshan Steel, Angang.
On swaps side, prices eased a bit yesterday with thin activity. November contract was heard being traded $151 earlier during Asia trading hours. SHFE steel future Oct contract traded down marginally at 4310 RMB this morning.
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