Spot Iron ore prices remain unchanged on Monday with not much buyers in the market. Quotes for Indian fines Fe 63.5/63 stays at $148/MT (CnF).
However, Iron ore may extend modest gains
this week as Chinese steel producers are likely to return to the spot market to
build stockpiles, but a sluggish domestic steel market is likely to limit any sharp
price rise.
Chinese steel prices have been
largely steady so far this year with activity in the domestic construction
sector, a heavy steel user, yet to fully resume.
“Construction activity is
still low because it's still winter in the northern part of China and we only
expect steel demand to return later this month or in March,” said a Shanghai-based
iron ore trader.
“Iron ore prices could rise
further this week with some more mills going back to the market and traders
taking positions,” said the Shanghai trader.
But a sizeable amount of iron ore
at Chinese ports, material that is readily available and which buyers can buy
in smaller tonnages unlike fresh spot cargoes, may limit appetite for more imports,
traders said.
Stockpiles of imported iron ore
at major Chinese ports reached 101.49 million tonnes last week, with shipments
from the three biggest exporters Australia, Brazil and India rising.
The most-traded May rebar
contract on the Shanghai Futures Exchange has risen 3 percent so far this year,
and little changed at 4,337 yuan a tonne by the midday break on Monday.
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