Prices for imported iron ore in China have surged on October 11, as demand has been much higher after the long holiday.
The price level for iron ore fines with 62 percent Fe content has increased by $12.2/mt since last Friday to $135.7/mt CFR. Ex-Brazil 65 percent Fe fines prices have surged by $13.7/mt to $160/mt CFR. Such a visible increase in prices has been supported by rising demand after the holiday.
In particular, a contract for 170,000 mt of BRBF fines with 62 percent Fe and low alumina content has been signed at $139.1/mt CFR on Monday, up $12.15/mt compared to a deal for similar material on Friday. Pilbara fines with 61.5 percent Fe have been sold at the October index (for 62 percent Fe fines) + $1/mt. Around 80,000 mt of Yandi fines with 56.7 percent Fe have changed hands at the November index - $22.9/mt. Also, 170,000 mt of 65 percent Fe iron ore have been traded at $160/mt CFR.
Futures for iron ore at Dalian Commodity Exchange have increased by RMB 48.5/mt ($7.5/mt) or 6.5 percent to RMB 797.5/mt ($123.7/mt).
Since demand for steel has been on a rising trend in China, this has supported iron ore prices. Nevertheless, since there are no expectations for any improvement in crude steel production, overall demand for iron ore may remain under pressure, sources believe. Taking into account high coking coal prices, Chinese mills will be interested in higher grade fines and pellets.
$1 = RMB 6.4479