Reflecting price fluctuation within the Chinese iron ore spot market during the last two days—a $9.8/mt decline and a subsequent $1.4/mt increase—sinter feed fines of 65 percent iron contents are now traded for export from Brazil to China at $181/mt, against $190/mt two days ago.
According to sources, the increase on Friday reflects chiefly intense buying interest by market players, derived from higher-than-expected decline of prices that followed expectations of stable or slightly increased prices ahead of the Chinese new-year holidays next month.
One observer mentioned that a 7-8 percent decline of prices has caught most players by surprise, leading to intentions of buying iron ore at lower prices. Previous expectations of stable or even higher prices were fueled by the positive results unveiled by the Chinese economy, coupled with concerns about the ability by the miner Vale to comply with its production plan for this year. Vale has experienced operational problems at the Ponta da Madeira port, which although minimized by the company, still raises fears of undersupply of iron ore this year.