The seaborne iron ore market turned active and touched to a level of USD 53/MT, CFR China on 27 June’16. Prices moved up by USD 2/MT after a long gap of around 15 days.
Firm steel prices and sentiments prevailing in China had supported spot iron ore prices, though trade seen was still thin.
To the contrary, stock inventories at major Chinese ports have increased further to 101.5 MT (as on 24 June’16).
Merger of top Chinese steel makers drove prices up
The recent tie-up between China’s second largest steel producer Baosteel and Wuhan Iron and Steel Group (WISCO), China’s 4th largest steel producer to restructure their business, have made positive sentiments in the market. Billet, rebar, and HRC prices moved up due this recent tie up.
Chinese domestic steel prices jump USD 23/MT M-o-M
Chinese steel prices too moved up accordingly. Spot billet prices in Tangshan rose by RMB 40/MT (USD 6) by the end of Week 26 and further prices gain by RMB 60/MT (USD 9) today. Currently, domestic billet prices are at RMB 1,980/MT (USD 304/MT), up by USD 23/MT in a month time. On similar lines, today spot rebar prices also rose by RMB 50/MT (USD 7.6).
Lifting of ban on steel production in Tangshan
The production cut announced by the city Tangshan inorder to ensure pollution free air between the period of 14 June to 19 June’16 is lifted and steel mills in Tangshan are again back on track for production.
Ideally, lifting of the ban in Tangshan city should support domestic iron ore prices but the market was seen quiet. Only seaborne iron ore market in China seems to grab attention by rising USD 2-3 MT within 2 days.
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