Slower demand for iron ore after the price increase yesterday, September 23, and expected stricter production measures in the northern part of China in October have put pressure on iron ore prices. Prices for Australian fines with 62 percent Fe content have lost $3/mt today coming to $89.5/mt CFR, while Brazilian Fe 65 percent fines have decreased by the same amount to $97/mt CFR.
Sources have been saying that demand has dropped and it is unlikely that the mills will be very active in purchases before the National Day holidays. Only one deal has been done on the trading platform for Pilbara fines, with the price based on the November index. Futures at Dalian Commodity Exchange have slipped by RMB 15.5/mt ($2/mt), while futures at Singapore Exchange has lost more than $3/mt, dropping to $87/mt.
As SteelOrbis has been informed, the city of Tangshan, a major steel production hub in China, will require local steel enterprises to implement production restrictions during the National Day holiday and autumn-winter season. From September 24 to September 30, blast furnaces will have to reduce production by 50 percent or more, with sintering machines, shaft furnaces and lime kilns suspending production completely. This has put pressure on sentiments in the iron ore market as the consumption of the raw material will be lower. At the same time rebar futures have been still going up in Shanghai Future Exchange, adding RMB 23/mt ($2.3/mt) over the day.
