Iron ore prices indicate big rises amid firm demand, futures up almost 4%

Import iron ore prices in China have indicated increases today, Thursday, December 7, while iron ore futures prices have increased by 3.93 percent on the same day. Steady high demand in China together will some expected slowdown of shipments from Australia due to rainfalls have provided the main support for prices and it seems that for now the impact of the government intervention on prices has eased.  

Iron ore fines with 62 percent Fe content have risen by $2.75/mt today to $136.15/mt CFR. This level is $4.65/mt above that seen one week ago. Brazilian iron ore with 65 percent Fe has indicated an increase of $2.6/mt on December 7 to $148.25/mt CFR, while up $4.3/mt week on week, SteelOrbis has learned.  

Ten deals for a total of 199,200 mt have been concluded at Corex today, including 80,000 mt of 62.7 percent Newman blended lump traded at the January 62 percent index + $0.185/mt, for shipment during January 9-18.  

During the given week, import iron ore prices in the Chinese market have increased amid strong demand as traders have started to buy for January shipment and overall port stocks have remained at low levels. Moreover, the China Iron and Steel Association (CISA) has announced that in late November (November 21-30) this year the average aggregate daily crude steel output of large and medium-sized steel enterprises in China increased by 2.39 percent to 2.0161 million mt, signaling still high demand for iron ore.  

Moreover, the uptrend in coke prices has also supported iron ore. Iron ore futures prices indicated sharp increases on December 7, exerting a positive impact on prices in the spot market. The shipments of iron ore may decrease in the coming week, which will bolster prices further. Most steelmakers may implement maintenance works on blast furnaces later this month, which will negatively affect the demand for iron ore and prevent prices from rising too high. Steelmakers’ profitability will likely shrink, which will weaken their demand for iron ore. It is expected that iron ore prices in the Chinese market will fluctuate within a limited range in the coming week.  

Iron ore futures prices at Dalian Commodity Exchange have risen by RMB 36/mt ($5.1/mt) or 3.93 percent to RMB 952/mt ($134/mt) compared to the previous trading day (December 6), while rising by RMB 36/mt compared to November 30.   

As of Thursday, December 7, rebar futures at the Shanghai Futures Exchange are standing at RMB 4,011/mt ($565/mt), increasing by RMB 98/mt ($14/mt) or up 2.5 percent since November 30, while increasing by 2.48 percent compared to the previous trading day (December 6).  

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 7.1176

Note: iron ore main futures contract shifts from i2401 to i2405.