The Chinese iron ore market continued to slide down over the past week, accompanied by a sharp fall in the trading volume. Due to the production halts and cuts of various mills, demand for domestic and imported ores posted a certain shrinkage in recent days. Looking at the current situation, given the high inventories of imported ore and the depressed demand situation, the Chinese iron ore market is unlikely to see any improvement in the short term.
Product name |
Specification |
Average price(RMB/mt) |
Price ($/mt) |
Weekly change (RMB/mt) |
Iron ore concentrate |
damp base (iron content: 66 percent) |
540 |
79 |
-20 |
India fine ore |
63.5 percent |
570 |
83 |
-20 |
The international shipping freight market registered a overall drop again in the past week. By the end of trading on March 19, the Baltic Dry Index (BDI) stood at 1,861 points, sharply down 410 points week on week. On March 19, the average freight charge from Brazil to Beilun Port in China was $16.89/mt, down by $3.57/mt compared with the level on March 12. Meanwhile, the average freight rate from Western Australia to Beilun on March 19 was $6.51/mt, down $0.97/mt compared with the rate on March 12. In addition, the freight cost of Indian ore to China's major ports has risen to $10.42/mt, a minor increase of $0.31/mt week on week.
Meanwhile, China's domestic iron ore market continued its sliding trend over the past week in a context of sluggish trading activity. At present, the price of 66 percent damp base iron ore in Tangshan, Hebei Province is RMB 540/mt ($79/mt, tax excluded), while the market prices in the northeastern regions are slightly down to the level of RMB 460/mt ($66/mt, damp base/tax excluded). Meanwhile, the prices of 63.5 percent Indian fine ore are at $56/mt FOB, while the CIF price (Tianjin Port) is around $66/mt. Additionally, the price quotation of 63.5 percent Indian ore is at the level of RMB 570/mt ($83/mt) at Chinese ports, while the deal price of 62.5 percent Australian PB fines has declined to RMB 600/mt ($88/mt), with the deal price of 65 percent Brazilian fine ore at around RMB 650/mt ($95/mt), down by RMB 20/mt ($3/mt) week on week.
As a result of the continuing softness observed in the imported ore market, iron ore inventories at the ports kept climbing over the past week. At present, total iron ore inventories at China's ports have climbed up again, to 65 million mt. Meanwhile, due to the production cuts or halts implemented by the mills, the demand for iron ore has shrunk considerably, leading to slack trading of imported ore at the ports.
As regards domestic fine ore, the market depression has seen a deterioration in recent days. Given the continuous decrease in iron ore prices and the sluggish market demand, it seems quite difficult for China's iron ore market to register any big improvement in trading performance in the coming period.