Over the past week import iron ore prices in China remained unchanged whereas domestic iron ore prices witnessed a slight increase, while a wait-and-see atmosphere prevailed in the market. Although some revival has been observed in the domestic steel market after the May Day holiday, steelmakers have not yet become very active in terms of iron ore purchases.
Product Name | Specification | Average Price (RMB/mt) | Price ($/mt) | Weekly change (RMB/mt) |
Iron concentrate | damp base (iron content: 66 percent) | 990 | 145 | +10 |
India fine ore | 63.5 percent | 1,320 | 194 | - |
In the past week, while the Baltic Dry Index (BDI) continued its upward trend, the international shipping freight market observed a small fluctuation. On May 6, the BDI closed at 3,468 points, up 139 points compared with last week. On May 6, the average freight charge from Brazil to Beilun port in China was $29.98/mt, down by $1.25/mt week on week. Meanwhile, the average freight rate from Western Australia to Beilun on the same day was $11.26/mt, up by $0.11/mt compared with April 28.
During the week in question, import iron ore prices trended neutral generally, whereas domestic iron ore prices witnessed a slight increase. At present, the price of 66 percent damp base iron ore in Tangshan, Hebei Province is at the level of RMB 990/mt ($145/mt, tax excluded), unchanged week on week, while the market prices in the northeastern region stand at RMB 870/mt ($128/mt, damp base/tax excluded), up RMB 20/mt ($3/mt) week on week. Meanwhile, the prices of 63.5 percent Indian fine ore have remained at $160/mt FOB, while the CFR price (Tianjin Port) is at $184/mt, down $1/mt week on week. In addition, quotations of 63.5 percent Indian ore remain at RMB 1,320/mt ($194/mt) at Chinese ports, while the deal price of 62.5 percent Australian PB fines are unchanged at RMB 1,320/mt ($194/mt), with the market price of 65 percent Brazilian fine ore remaining at RMB 1,380-1,400/mt ($202-205/mt).
In the past week, China's iron ore market trended sideways with just a slight increase in domestic prices. After the May 1 holiday, construction steel including finished steel, HRC and semi-finished observed a price increase, providing some support for the iron ore market. Currently, traders and mills are maintaining a wait-and-see attitude, with mills in no rush to make purchases. Looking at the current market situation, the price of import iron ore may decline in the near future, albeit not by much.
Meanwhile, with the rainy season approaching on India's western coast, the ports on the coast including Goa will be closed, resulting in a reduction of exports of Indian iron ore. Since the western coast mainly exports low grade iron ore, the import price of low grade iron ore in China may be unlikely to see a decline in the near future.