Global iron ore prices are witnessed at USD 82/MT, CFR China as on 07 Feb’17. Seaborne prices remained volatile and increase USD 2/MT in a day.
Prime reason behind increase in prices was rebounding of billet and future market. Future market moved up amid news that coke producers in Shanxi province may cut output to support prices.
Many mills are relatively optimistic about the steel market in March and April, as consumption rates are typically healthy during spring, steel production will be healthy.
In addition, recent reports regarding temporary closure of Australia’s Port Hedland due to tropical system has left buyers in dilemma and they are not ready to take any position.
It is to be noted that Australia is largest exporter of iron ore to China and contributes around 65% of total imports. Port Hedland has exported around 40.3 MnT iron ore in Jan’17 which is around 2 MnT per day. Port Hedland is the largest bulk terminal exporting steel making commodities like iron ore and coal.
Low grade iron ore fines in China is still hard to sell and it is available at discounts of around 35% against index.
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