Spot iron ore prices have went
down sharply to reach their lowest in a year and are expected to drop further as
demand from China remains thin.
“We are not able to sell one
tonne of iron ore now and I don't expect the market will see any big
improvement at least before early 2012,” said an iron ore trader in
Shanghai.
“The sentiment in the iron ore
market is so bearish and tense that big miners like BHP Billiton and Rio Tinto
have asked the few steel mills that they've been selling to not to disclose
prices as more the prices are revealed, the more prices will go down”, traders
said.
Sellers had cut their prices
further by yesterday evening with Indian Fe 63.5/63 at $150/MT i.e. down by $3
from Wednesday and $13-$14 cheaper from last week. Similarly, Australian
61.5-grade Pilbara fines were offered at $141-$143/MT i.e. down by $2 from
Thursday and $17 lower from the previous week.
Reflecting the bearish mood,
prices of forward swaps resumed their decline on Thursday after rising in the
previous session.
The Singapore Exchange-cleared
November contract fell $4.12 to $124.50 a tonne, a steep discount to spot. The
December contract slipped $4.62 to $122.25 and January dropped $4.19 to
$121.31.
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