The price of the Brazilian high-grade iron ore, 65 percent iron contents, is $94/mt today, against $105/mt on October 25, CFR China conditions.
The decline still reflects a scenario of high iron ore production by Vale and BHP, raising pressure from the supply side, coupled with the negative mood from the Covid zero policy in China and consequent reduced steel production and iron ore demand in the country.
The Brazilian high-grade product has now a premium of 11.7 percent in relation to the 62 percent Australian iron ore, against 10.5 percent previously, maintaining an uptrend during the last months, which reflects the increased demand for premium products for their performance in blast furnaces.
The export price of blast furnace grade pellets is now $119/mt, CFR China, against $129/mt previously, reflecting a stable premium ascribed to the product in relation to the equivalent sinter feed fines.
In the Brazilian domestic market, the prices are now estimated at $70/mt for the iron ore and $94/mt for the pellets, against respectively $79/mt and $103/mt previously, ex-works, no taxes included. Such prices were affected by a small variation of the freight rate from Brazil to China, as the base for the domestic price is the FOB equivalent price.