Iron ore prices in Brazil increased in average by $5/mt in one week, benefiting from higher prices in the Chinese spot market.
The gain in FOB price terms could be higher, but slightly increased ocean freight costs had a negative impact, estimated at $1/mt.
Sinter feed fines of 65 percent iron contents are now traded for export at $67/mt, lumps at $71/mt and blast furnace grade pellets at $102/mt, FOB conditions.
In the domestic market, the prices are now $62/mt for sinter feed fines, $68/mt for lumps and $97/mt for pellets, ex-works, no taxes included.
The Brazilian ore of 65 percent iron contents is particularly benefited under today’s price rush, for being more energy efficient than the Australian ore and requiring less coke to operate.
For this reason, the iron unit of the Brazilian ore is currently priced 12 percent higher than the Australian product, against a historic average of similar prices, reflecting chiefly the current high costs of coal and coke.
For this reason, the iron unit of the Brazilian ore is currently priced 12 percent higher than the Australian product, against a historic average of similar prices, reflecting chiefly the current high costs of coal and coke.
In world terms, the premium for blast furnace grade pellets over sinter feed fines remains at $35/mt, while for DRI grade pellets it remains at $45/mt.
But a source from a local steel producer told SteelOrbis that the supply of pellets for 2017 is currently negotiated at a price premium of $45/mt over sinter feed fines, in his view also a reflection of the high coal and coke prices, as pellets are energy efficient in blast furnaces.
The total Brazilian exports of pellets in October declined by 24 percent to 2.09 million mt. Preliminary indications by the local customs authorities indicate that, in November, the Brazilian combined exports of iron ore and pellets will probably increase in volume by 10 percent from October.