Iron ore price rise supported by better expectations for steel demand and output

The situation in the iron ore market has improved as more steel mills have started to be more optimistic about demand in the near future as the government has been taking measures to boost the resumption of operations of major downstream enterprises. Iron ore prices with 65 percent Fe content have edged up today, February 20 compared to the previous day. Iron ore fines with 62 percent Fe content have increased by $1.6/mt to $90.5/mt CFR, while Brazilian iron ore with 65 percent Fe has gained $1.3/mt to $106/mt CFR, SteelOrbis has learned.

There has been a deal for 170,000 mt of Brazilian 65 percent Fe fines at $106/mt CFR today. Another transaction for 90,000 mt of Jimblebar fines with lower than 60 percent Fe was done at the index with a $7.2/mt discount.

This week, epidemic prevention and control have remained the top priority in China, and so more time is needed for demand to recover to normal levels. However, China has taken measures to boost the resumption of operations of industrial capacities, though difficulties still exist, such as the disruption of transportation and some migrant workers still not having returned back to work.

Iron ore futures prices at Dalian Commodity Exchange have gained RMB 42.5/mt ($6.1/mt) or 6.8 percent coming to RMB 667/mt ($95.3/mt) compared to February 13, while up 4.22 percent compared to February 19.

Steel futures have also seen an overall uptrend recently, indicating that market players have started to be hopeful for the future market. Rebar futures at Shanghai Future Exchange have increased by RMB 65/mt ($9.3/mt) or 1.9 percent on Thursday since February 13, while up 2.1 percent compared to the previous trading day.  

Imported iron ore prices in China (week-on-week basis)

Price Includes VAT.  

Nationwide iron ore concentrate prices (66 percent Fe)

Price Includes VAT. 

$1 = RMB 7.0026