China: Spot Iron Ore Fines Index Surge Amid Supply Concerns

Spot iron ore fines Fe 62% index have reached new record levels at USD 106.50/MT,CFR China yesterday i.e on 12th June'19. The increase in prices is owing to increased demand and tight supply. The iron ore supply from major Brazilian and Australian miner still remains hampered. As per reports, few major Australian miners have delayed July and August iron ore shipments to some of its buyers.

The prices have hit new 5 years high level after USD 108/MT, CFR China recorded towards end of May'19. The prices were last witnessed in May'14. The prices as on 12th June have picked up by 9% as compared to USD 97.95/MT, CFR China towards beginning of last week.

As per SteelHome consultancy, Iron ore inventory at major Chinese port fell to 124.9 MnT towards May'19 end, level last seen in Feb'17 as against 133.6 MnT towards beginning of May'19. The inventory fell to 121.6 MnT last weekend, depicting steady fall against this year peak levels of about 150 MnT observed in early Apr'19. Amid low stock in China, mills continue buying expensive material to continue full-load operation.

As per reports, Chinese mills will be focusing on more infrastructure projects in July and August which is expected to boost the steel consumption and hence, requirement of raw materials.

Dalian iron ore futures hit record high levels

Dalian iron ore futures reached record high levels at 778.5 yuan yesterday as against previous record levels of 758.5 yuan/MT assessed on 27th May'19. As per reports the level so reached is highest since its inception in 2013.