Iron ore prices have increased again today, Wednesday, October 23, thus adding $2/mt over the past two days as futures prices have been going up and as there have been some increases in the steel segment. However, sources doubt that the trend is sustainable. Prices for fines with 62 percent Fe content have increased by another $1/mt today to $87/mt CFR, while Brazilian fines with 65 percent Fe have added $1.2/mt to $94.2/mt CFR, SteelOrbis has learned.
Rio Tinto has closed a tender for 170,000 mt of Pilbara fines Fe 62 percent at $87/mt CFR for November shipment. Moreover, 90,000 mt of Jimblebar fines, which traditionally has Fe content of 61 percent, have been sold at the November index. Sales have improved from ports as well, with prices adding RMB 5-10/mt.
Iron ore futures at Dalian Commodity Exchange have added RMB 7.5/mt ($1/mt) over the day and have come to RMB 620.5/mt ($88/mt). Moreover, average billet local prices in China have increased by RMB 23/mt ($3.2/mt) to RMB 3,423/mt ($484/mt) ex-warehouse, according to SteelOrbis’ information.
Nevertheless, there are not too many bullish expectations for the future as some slowdown in demand in the local market in winter and still high steel production will hit steelmakers’ margins, and they will look for lower iron ore prices.
$1 = RMB 7.075