Iron ore stops falling for now, fluctuates at below $120/mt CFR, a 4-month low

Import iron ore prices in China have indicated small rises today, Thursday, February 29, though they have posted bigger declines compared to February 22, mainly due to the slow demand resumption and rising stocks.

Iron ore fines with 62 percent Fe content have inched up by just $0.2/mt today to $117.4/mt CFR. This level is $3.2/mt below that seen one week ago. Brazilian iron ore with 65 percent Fe has indicated a rise of $0.1/mt on February 29 to $130/mt CFR, while it is down $3/mt week on week, SteelOrbis has learned.

16 deals for a total of 161,000 mt of import iron ore have been concluded on February 29 at the Corex platform, which means that in general demand has slowed today, with 542,000 mt having been traded at Corex on Wednesday. Around 10,000 mt of 61.71 percent PB fines have been traded at RMB 922/mt ($130/mt), for delivery at Caofeidian port.

During the given week, import iron ore prices have moved down amid rising supplies and increasing inventory levels. Currently, steelmakers’ profitability is at relatively low levels, limiting their production resumptions following the holiday. This has put pressure on the demand for iron ore and exerted a negative impact on prices. The supply of iron ore from Australia and Brazil may be disrupted by adverse weather, which potentially may reduce the iron ore arriving at ports next week, which can prevent iron ore prices from recording further sharp drops, at least in the near future.

Iron ore futures prices fluctuated within a limited range over the past week, bolstering spot prices to a certain degree. However, market players think iron ore prices will come under downward pressure if steelmakers’ profitability does not improve significantly in the short term. It is thought that import iron ore prices may fluctuate within a limited range in the coming week.

Iron ore futures prices at Dalian Commodity Exchange have declined by 0.17 percent today to RMB 892/mt ($125.6/mt) compared to the previous trading day (February 28), while decreasing by RMB 1.5/mt ($0.2/mt) compared to February 22.

As of Thursday, February 29, rebar futures at the Shanghai Futures Exchange are standing at RMB 3,788/mt ($543/mt), decreasing by RMB 9/mt ($1.3/mt) or 0.24 percent since February 22, while decreasing by 0.66 percent compared to the previous trading day (February 28).

Imported iron ore prices in China (week-on-week basis)

Price includes VAT.  

Nationwide iron ore concentrate prices (66 percent Fe)

Price includes VAT. 

$1 = RMB 7.1036