Chinese Spot Iron Ore Fines Price Climbs to 4-Month High on Supply Concerns
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Chinese spot iron ore fines (Fe 62%) price increased to USD 95.65/MT, CFR China, as on 9th Jan'20. The prices picked up to almost four-month high as the level were last witnessed towards mid Sep'19 at USD 96/MT, CFR China. The prices have witnessed increase by USD 2.65/MT, CFR China D-o-D as against USD 94/MT, CFR China assessed on 7th Jan'20. On weekly basis, price increased by USD 3/MT.
Why have prices increased ?
--The rise is attributed to anticipated supply constraints amid risks of flooding in Western Australia and Brazil.
--Also, Chinese mills have depicted increased restocking ahead of holidays starting from Jan 24, resulting in high discharge rates at ports.
As per mysteel data, Iron ore inventory at major Chinese ports dropped to 125 MnT last week, down 1.8 MnT against previous week.
Spot pellet premium Up 10% W-o-W:
Spot pellet premium for Fe 65% grade pellets increased to USD 27.45/MT, CFR China as against USD 24.95/MT, CFR China assessed last week. The prices improved amid increased bidding inquiries due to ongoing steel production curbs. Besides, the rising coke prices favored pellet demand.
Dalian iron ore future jumped for the day
Dalian iron ore futures for May 2020 increased 2.85% to 685 yuan (USD 98.69/MT) on Tuesday morning (7th Jan) and closed at 680 yuan towards day end, highest closing since 2nd Aug'19.
