According to port authorities in China, iron ore inventories at the country's main ports have reached about 75 million mt, up approximately 2 million mt week on week. Meanwhile, total inventories at all Chinese ports amount to nearly 84 million mt, registering a significant increase compared with the previous week.
As indicated by analysts, China's iron ore import market has lately observed a slight increase in price but a slowdown in demand. Despite the continuing slight price increases in quotations of imported iron ore, the upward trend in the domestic iron ore market has halted, mainly due to the decline in semi-finished steel prices in some regions.
Last week, the deal price of Indian iron ore (63.5 percent Fe) exceeded the price level of $140/mt CFR, up over $10/mt within one week, mainly due to the price increases in China's domestic steel market and to the uptrend in the domestic steel futures market caused by the strong rebound in the global financial markets. However, it seems difficult for the price increases in iron ore to be accepted by the steel producers due to the weak demand from downstream industries.
Wang Ziliang, chairman and general manager of Henan-based Chinese steel producer Anyang Steel, has stated that the imbalance between supply and demand is the main obstacle blocking steel prices from continuing their upward trend.
Meanwhile, Rory Macdonald, iron ore analyst from The Steel Index (TSI), has estimated that the price of iron ore in China will drop down in the second half of 2010.