Iron ore up over week amid steel output curbs not strict as expected, though down today

Import iron ore prices in China have indicated downward correction today, Thursday, August 24, though moved up compared to last week, supported by iron ore futures prices and not that strict crude steel production cuts in China.

Iron ore fines with 62 percent Fe content have decreased by $1.25/mt today to $114.6/mt CFR. However, this level is still $6.6/mt above that seen one week ago. Brazilian iron ore with 65 percent Fe has indicated a drop of $1.4/mt on August 24 to $126.45/mt CFR, while up $6.45/mt week on week, SteelOrbis has learned.

Eighteen deals of 367,700 mt have been concluded on Corex today, including 100,000 mt of 62.7 percent Newman blended lump and 85,000 mt of 62 percent BRBF fines deal at September index +$0.13/mt and October 62 percent Low Alumina index +$4.1/mt with shipments during September 21-30 and September 18-27.

Import iron ore prices moved on an uptrend in the given week even despite the sharply increasing volume of iron ore arriving at ports due to the delay caused by typhoon. Demand for iron ore increased as the number of furnaces resuming production was more than the number of those on maintenance. Though there was information regarding that Chinese steelmakers will implement production restrictions to curb the crude steel output in the rest of the current year, market players still expected for the better demand in September. It is expected that import iron ore prices in the Chinese market will likely fluctuate within a limited range in the coming week.

On August 24, iron ore futures prices have indicated a big increase of 5.5 percent week on week even against the anticipated production restrictions on crude steel output, which was believed not as strict as market players expected. At the same time, demand for steel may improve as the traditional peak season of September and October is approaching, which will exert a positive impact on iron ore prices.

Iron ore futures prices at Dalian Commodity Exchange have declined by 0.86 percent to RMB 811/mt ($112.8/mt) compared to the previous trading day (August 23), while increasing by RMB 42.5/mt ($5.9/mt) compared to August 17.

As of Thursday, August 24, rebar futures at the Shanghai Futures Exchange are standing at RMB 3,688/mt ($513/mt), decreasing by RMB 38/mt ($5.3/mt) or down 1.0 percent since August 17, while decreasing by 1.23 percent compared to the previous trading day (August 23).

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 7.1886