SteelOrbis Shanghai
Due to the frequent arrivals of imported ore, inventory saw a fast increase at
China's ports during the week. Meanwhile, the domestic ore market moved on a stable trend.
On December 14, the price of 66-percent damp base
iron ore in Tangshan was at RMB 580/mt ($74.3/mt) excluding tax, while its price in Beipiao city of Liaoning Province was at RMB 460/mt ($59/mt) excluding tax. The price quotation of 63.5-percent
India fine ore was at RMB 655/mt ($83.9/mt) at Tianjin Port, while the price at Qingdao Port was at RMB 640/mt ($81.9/mt). The price of Australian Hamersley 62- and 63-percent fine ore at Beilun Port was at RMB 640/mt ($81.9/mt), equal to the level of the previous week.
According to the official data, by the end of the previous week, the total inventory of
iron ore at
China's twenty-three major ports amounted to 38.99 million mt, up 1.02 million mt week on week. Due to the frequent arrivals of imported ore, inventory increased rapidly. However, the inventory level was still low compared with most other months this year, and so is unlikely to create much pressure on prices.
In recent days,
freight from
India to
China continued to go up by $2/mt throughout the past week. With FOB prices unchanged, the CIF price has already risen to approximately $78/mt. Nevertheless, the
freight charges from
Brazil and
Australia to
China saw slight fluctuations with a mixed price trend. The continuous increase in Indian ore costs provided support for
iron ore prices in the upcoming period.
Over the past week, the domestic market was quite stable on the whole, with the northeastern region showing a weak trend and the northern and northwestern regions showing a strong trend.
The latest figures released by the
China Iron & Steel Association (CISA) show that
iron ore imports of
China saw saw the first-ever decrease in the quantity of imports for a month on a year-on-year basis in October. Then in November, imports for the month totaled 28.56 million mt, merely up 4.7 percent compared with the same period last year, showing an obvious slowdown in imports growth. Of course, this does not mean that the dependence of
China on imported ore is declining.
In addition, the CISA data also show that
China's
iron ore output in November totaled 59.27 million mt, up 18.08 million mt or 44 percent year on year and up 3.78 million mt or seven percent month on month. The cumulative output for the Jan-Nov period totaled 521.5 million mt, up 38 percent - representing an accelerating rate in
iron ore output.
All in all, the Chinese
iron ore market saw a stable performance during last week. The upward trend is coming to an end and the market is unlikely to see an overall increase. Since both import arrivals and domestic output will increase in the period ahead, the
iron ore price is facing a downward tendency with a decline in demand.