Iron ore prices have rebounded today, Friday, January 17, after customers accepted some increase in new deals. Brazilian higher grade fines have been in demand as Vale will cut allocation for February shipment. As a result, ex-Brazil iron ore prices have gained faster than ex-Australia fines prices. Prices for Australian fines with 62 percent Fe content have added $0.7/mt today to $95.6/mt CFR, while Brazilian Fe 65 percent iron ore quotes have increased by $1.9/mt to $110.7/mt CFR.
A deal for 170,000 mt of Brazilian 65 percent iron ore fines has been done today at $110.7/mt CFR for shipment in late January. Two deals for 170,000 mt each of Pilbara fines have changed hands at the March index with an extra $1.9/mt and $2/mt for shipment in late February-early March. Yandi fines have been sold at the March index with a $5.7/mt discount. Overall trading activity at Chinese ports has remained slow due to the approaching holiday.
As announced in December, Vale is going to produce and sell 68-73 million mt of iron ore in the first quarter of 2020, which is lower compared to the previous forecast of 70-75 million mt. Also, today the miner halted operations at its 1.2 million mt per year Esperanca mine in Chile. Moreover, Rio Tinto has announced a three percent decline in total iron ore shipments for 2019, which also supports the increase in iron ore spot and futures prices. Iron ore futures prices at Dalian Commodity Exchange increased by RMB 5.5/mt ($0.7/mt) today to RMB 669.5/mt ($97/mt).
