The current price for ex-Brazil high-grade iron ore, with 65 percent iron content, is $102/mt, down from $104/mt last week, CFR China. This decline is due to data indicating reduced steel production in China. However, improved operational margins achieved by local steel producers and resilient demand for steel products in China have supported prices, preventing a more significant decrease.
The export price of blast furnace-grade pellets is now $115/mt, compared to $118/mt last week, CFR China. This maintains the same premium relative to sinter feed fines.
The premium for Brazilian high-grade ore containing 65 percent iron relative to Australian ore containing 62 percent iron, based on iron content, has increased to 5.2 percent from 5.1 percent. This reflects integrated producers’ interest in the performance of premium ores in blast furnaces.
In the Brazilian domestic market, reference prices are now $75/mt for the ore and $88/mt for pellets, down from $79/mt and $93/mt, respectively, ex-works and excluding taxes. These prices have been negatively affected by higher Brazil-China freight rates since the domestic price is based on the FOB quotation, using CFR China as the reference.
In May, Brazil exported a combined total of 35.1 million mt of iron ore and pellets. Preliminary information suggests that a lower volume is expected for June.