Global Iron Ore Prices Increase Marginally Post Holidays

Despite week long holiday in China, global iron ore fines (Fe 62%) prices showed marginal increase and stood at USD 54.8/MT, CFR China on 08 Oct’15. Prices of Chinese billet rose by RMB 10/MT. Shanghai rebar prices are at USD 291/MT.

Chinese steel mills have started refilling their mills with iron ore post holidays (week long National Day). There can be some gain in the prices this week, as after holidays Chinese steel makers are refilling their mills with the raw material.

However, this gain, might be for short term as low demand and weak steel market in China may force Chinese steelmakers to curb their production in the coming weeks. This would directly impact the prices which might fall further.

Usually seasonal demand picks up in the months of Sept-Oct. But, due to slow growth in the Chinese economy, there is no pickup in the seasonal demand too.

Gina Rinehart’s Roy Hill project- ready to make its 1st iron ore shipment

Australia’s Roy Hill mine is all set to make its first shipment this month. Most probably the first iron ore cargo will ship on 21 Oct’15. The Roy Hill project has an annual production capacity of 55 MnT pa, out of which 50% will be taken up by China Steel Corp, POSCO and JV Partners etc.

Roy Hill project have a mine life of 17 years. It is anticipated that addition of iron ore from Roy Hill mine in the market will worsen the situation further and iron ore prices may slump to USD 40/MT in the coming term.

Global iron ore Prices as on 08 Oct’15  

CNF China prices
Source: SteelMint