Seaborne iron ore prices have increased sharply by USD 5/MT in a day time. Currently prices for Fe 62% Australian fines are hovering at USD 80/MT, CFR China on 11 Nov’16. The prices are at two years high as prices at such levels were last seen in the Oct’14. It should be noted that seaborne iron ore prices moved up sharply by USD 13/MT in a week time.
Surge in coking coal prices along with sudden rise in spot steel prices in China led to increase in iron ore prices.
Few Chinese leading steel mills hiked their prices for middle November sales by RMB 400-50/MT (USD 60-74/MT) for flat and long products. In addition, spot rebar prices also rose by RMB 110/MT (USD 16/MT) and spot billet prices in Tangshan rose by RMB 20/MT. Current prices for spot billet in Tangshan is at RMB 2,590/MT (USD 380/MT).
Meanwhile, future market also surged today. It was because of announcement made by National Development and reform Commission (NDRC) as the country’s coal and steel industries have met the 2016 production cut targets. This has spur iron ore prices to move up.
Due to ongoing shortage of coking coal in China, demand for high grade iron ore remained strong which is majorly supplied by Australia and Brazil, and it is anticipated that iron ore prices may likely to remain around USD 85/MT for coming 2-3 months.
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