Global iron ore prices are assessed at USD 59.9/MT, CFR China on 13 Apr’16. Prices are again gaining momentum amid surging steel prices in China.
There is sharp increase of USD 7/MT in global iron ore prices upon sustained increase in spot steel prices in China. The continuous rising steel prices in China had lifted margins gaps for Chinese steel makers. Last month, due to Lunar New Year Holidays, steel prices were massively hit amid slow demand.
One of the Chinese market participant mentioned “Traders are expecting increased iron ore buying from the mills given the larger increase in steel prices”.
China’s spot rebar prices in Shanghai were up by RMB 50-100/MT (USD 8-15)/MT. Spot billet prices in Tangshan also gained by RMB 30/MT.
Meanwhile, Chinese iron ore imports remained at 85.7 MnT in Mar’16. Imports were increased by 16.4% as compared to Mar’16 due to Lunar holidays and it is likely that demand for iron ore in China will also be recovered in the coming time.
Iron ore imports are likely to remain high for the next 3 months as major miner namely Australia will ship more iron ore to China inorder to meet its financial ending target by the end of June.
By looking towards the current demand-supply fundamentals, it is likely that prices will remain within the range of USD 55-58/MT by the end of Apr’16.
Trade wise:
- Rio Tinto sold 100,000 MT Australian blend Fe 61% fines at USD 59.8/MT, CFR China via tender
- BHP Biliton sold 90,000 MT Fe 60.8% fines at USD58.8/MT, CFR China via private tender
- Vale sold 90,000 MT Fe 65% Carajas iron ore fines at USD 65/MT, CFR. The cargo is likely to ship Malaysia
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