The Chinese iron ore market has continued to follow a strong trend during the past week. Ex-Indian iron ore offers maintained their upward trend. However, steelmakers and traders were becoming more cautious and a slowdown was observed in the volume of market transactions.
Product name |
Specification |
Average price (RMB/mt) |
Price ($/mt) |
Weekly change (RMB/mt) |
Iron concentrate |
damp base (iron content: 66 percent) |
1,070 |
161 |
+20 |
India fine ore |
63.5 percent |
1,270 |
192 |
With Christmas approaching, the international freight market was relatively stable, with just slight decreases seen. On December 23, the Baltic Dry Index was at 1,830 points, down 198 points on the previous week. On December 23, the freight rate on the Tubarao, Brazil-Beilun/Baoshan shipping route was $21.06/mt, down $0.59/mt week on week, while on the same day the freight rate on the Western Australia-Beilun/Baoshan route was $8.18/mt, down $0.54/mt week on week.
In the Tangshan district, the transaction prices of 66 percent damp base iron ore have been at RMB 1,070/mt ($161/mt, damp base,VAT excluded) in the past week, while in the northeastern region market prices of iron ore are at RMB 970/mt ($146/mt, damp base, VAT excluded), both up about RMB 20/mt ($3/mt) week on week. Indian iron ore offers climbed up; as a result, quotations of 63.5 percent Indian iron ore are RMB $158/mt FOB, while Tianjin port transaction prices stand at $175-177/mt (CFR), up $2/mt week on week. Meanwhile, mainstream quotations of 63.5 percent Indian iron ore at Chinese domestic ports are at RMB 1,270/mt ($192/mt), Australian PB fines are quoted at RMB 1,250/mt ($189/mt), up RMB 20/mt ($3/mt), while the market price of 65 percent Brazilian iron ore fines is RMB 1,350/mt ($204/mt).
Import iron ore offers at Chinese ports have remained strong. At present, Indian iron ore fines offer have reached $177/mt (dry goods) CFR. At present, although overseas prices are increasing, the market transaction situation is not satisfactory. Most traders consider it risky to purchase so they prefer to wait and see.
Meanwhile, the three iron ore giants have reduced supplies, while India has restricted iron ore exports. As a result, iron ore has been in short supply at Chinese ports. In this context, low grade iron ore supplied by India and Southeast Asian countries have been welcomed by small and medium Chinese steel mills. Large steel mills have been inquiring mainly about medium and high grade Australian iron ore, Iranian iron ore and South American iron ore. At present, steel mills are not very active in concluding purchases.