Iron ore prices in China down by up to 9% this week amid typhoon-related fall in demand

Import iron ore prices in China have been falling continuously this week with the benchmark 62 percent Fe fines losing 8.8 percent. Poor demand for iron ore and worsening sentiments and lower spot prices for steel products due to the typhoon-related floods in northern China have attributed to the significant drop in raw material prices.

Iron ore fines with 62 percent Fe content have decreased by $3.35/mt today to $103.5/mt CFR. This level is $10/mt below that seen one week ago. Brazilian iron ore with 65 percent Fe has indicated a decline of $3.75/mt on August 3 to $117/mt CFR, while down $9.85/mt week on week, SteelOrbis has learned.

15 deals for 356,500 mt in total have been concluded at the Corex platform today, including 170,000 mt of 62 percent BRBF fines with a low-alumina deal at $106/mt CFR for shipment during September 2-11.

During the given week, import iron ore prices have seen a downward trend as floods in northern China negatively affected steelmakers’ production activities, which reduced the demand for iron ore. At the same time, inventory of rebar has increased, reflecting declines in apparent consumption, after previous rises, also exerting a negative impact on iron ore prices. Typhoons Doksuri and Khanun will continue to affect northern China, which will weaken the support for demand for steel and also result in the downtrend of iron ore prices. Moreover, steelmakers in China are required to control their outputs, likely contributing to the weak demand for iron ore. It is thought that import iron ore prices in the Chinese domestic market will likely edge down in the coming week.

Iron ore futures prices at Dalian Commodity Exchange have decreased by 2.99 percent to RMB 810.5/mt ($113.4/mt) compared to the previous trading day (August 2), while decreasing by $4.48/mt compared to July 27.

As of Thursday, August 3, rebar futures at the Shanghai Futures Exchange are standing at RMB 3,728/mt ($521/mt), declining by RMB 133/mt ($18.6/mt) or down 3.4 percent since July 27, while decreasing by 2.79 percent compared to the previous trading day (August 2).

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 7.1495