Iron ore prices in the Chinese spot market this week are at $187/mt for the Brazilian sinter feed fines of 65 percent iron contents, $221/mt for equivalent lumps and $240/mt for blast furnace grade pellets, CFR China conditions, against $198/mt, $217/mt and $238/mt, respectively, last week.
Despite the $11/mt decline for sinter feed fines prices, reflecting additional restrictions on crude steel production in China, the price of lumps and pellets has actually increased, due to strong demand for products that allow for direct charge in blast furnaces, which reduces the emissions associated with the sintering process and consumes less coke.
Even for the Brazilian sinter feed fines, the premium for its iron unit in relation to the Australian 62 percent iron product is currently 12.0 percent, the higher figure since May 2020, also reflecting the demand for reduced emissions associated to the use of the high-grade product.
A local source mentioned that today it is difficult to forecast the next developments of the seaborne iron ore market, as prices remain in a very high level. The source mentioned that the price for the blast furnace grade pellets should be followed closely, as the Brazilian pellet producer Samarco has returned to operations after halting in 2015 due to the collapse of a waste dam.
In the Brazilian domestic market, iron ore prices are estimated at $160/mt for sinter feed fines of 65 percent iron, $193/mt for equivalent lumps and $212/mt for blast furnace grade pellets, ex-works, no taxes included.