China's National Development and Reform Commission (NDRC) stated on its website on June 29 that the main product prices in key domestic industries are expected to maintain a stable trend in the coming period, while domestic steel prices may continue to trend down though by limited margins.
"The government will continue to stick to maintain its measures to prevent real estate prices from rising too fast, which will restrain steel demand to some extent," the NDRC said in its statement. According to data released by the NDRC, in May the average price of four categories of steel in 22 cities in China was RMB 4,838/mt ($713/mt), down 3.7 percent month on month and up 29.4 percent year on year. Meanwhile, the NDRC said that, due to the increase in the iron ore price for the third quarter, the high iron ore cost will prevent steel prices from indicating any sharp declines.
According to the data reported by the China Logistics Information Center, in May quotations of domestic and imported iron ores remained at high levels despite the slight price decline during the month in question. In particular, the prices of iron ore concentrate (66 percent) produced in Tangshan, Hebei and in Fushun, Liaoning were at RMB 1,209/mt ($179/mt) and RMB 1,082/mt ($159/mt) respectively, up 76 percent and 85.7 percent year on year, while the spot price of Indian iron ore (63.5 percent) in Qingdao Port saw a 128.6 percent increase year on year.