Global iron ore prices are witnessed at USD 57/MT. After the steep rise to a level of USD 62/MT, prices have started going down as steel prices are falling gradually.
Chinese steel prices fell to 2-week low. Chinese domestic billet (Q235) offers were lowered by RMB 60/MT as compared to the last week. Today, billet prices were at RMB2,150/MT (USD 330/MT). Similarly, spot rebar prices also moved down today.
Chinese steel mills kept low inventory of raw materials to avoid risks and iron ore traders gradually see bearish outlook towards the market.
Steel demand usually picks up in September after summers, but actual demand has failed to show a recovery since August due to the suspension of some construction activities for the G20 summit.
Iron ore inventories at Chinese major ports remained high. As on 09 Sept’16, stocks at ports were recorded at 103.4 MnT, maintaining the higher level above 100 MnT. Rising imported ore inventories will pressurize iron ore prices in the near term.
Recently, China customs have released iron ore imports figure for the month of Aug’16, which remained at nearly monthly highest at 87.44 MnT in the year 2016. Meanwhile, country’s crude iron ore production is declining and for Jul’16 it was recorded at 115.4 MnT in the month of Jul’16.
In addition, declining country’s crude iron ore production, as well as rising imports, are also some of the major factors which will pressurize iron ore prices in the coming term.
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