Iron ore prices have been moving up on Monday, September 30, as trading activity has improved before Chinese customers leave the market for the holiday on October 1-7. Prices for iron ore fines with 62 percent Fe content have added $1.8/mt since Friday to $93.2/mt CFR, while prices for 65 percent Fe fines have increased by the same amount to $100/mt CFR, SteelOrbis has been informed.
Two deals for Pilbara fines at GlobalOre for 100,000 mt and 170,000 mt have been concluded at $92.75/mt CFR and $93/mt CFR for late October-early November shipment. Another cargo of 170,000 mt of Pilbara fines has been sold based on the November index plus $4.3/mt. Pilbara iron ore fines have been the most popular product recently as mills have been restocking and expectations for the first week after the long holiday have been mostly bullish.
There have been two more deals for Brazilian BRBF fines and Australian Newman fines, with prices fixed according to the November and October indexes with extras.
The increase in futures prices has also supported spot prices. Iron ore at Dalian Commodity Exchange has gone up RMB 16/mt ($2.2/mt) and has closed at RMB 655.5/mt. Moreover, rebar at Shanghai Future Exchange have increased by RMB 36/mt ($5/mt) on Monday.
Moreover, the Australian government's Department of Industry and Science has increased its price forecast for 2019. “The forecast iron ore price in 2019 has been revised up to an average of $80 a tonne free on board (FOB). This reflects the full effect of supply disruptions - primarily in Brazil - and firm demand from China,” the department stated in the summary to its quarterly report. But the major driver of higher prices will be mostly demand as export volumes from major suppliers Australia and Brazil will not decrease not sharply as was expected earlier. In 2019, iron ore exports from Australia will total 828 million mt, lower just by 7 million mt from 2018, while in the previous quarterly report the department had forecast a 21 million mt reduction. Brazil will export 384 million mt of iron ore, just 4 million mt below last year and much lower than the previously expected 20 million mt drop.
