Iron ore touches $90/mt CFR due to weak demand and high stocks

Import iron ore prices in China have dropped by over $10/mt over the past week, coming close to the $90/mt CFR mark, while iron ore futures prices have decreased by 10.7 percent compared to August 29, falling to the lowest levels in the past year. Amid their increased financial losses, steel mills have been putting pressure on iron ore prices and the continuous fall in steel spot and futures prices have resulted in the decline in raw material prices.

Iron ore fines with 62 percent Fe content have indicated a decrease of $1.5/mt on September 5 to $90.2/mt CFR. This level is $10.9/mt below that seen on August 29. Brazilian iron ore with 65 percent Fe has decreased by $1.55/mt on September 5 to $103.8/mt CFR, while down $11.15/mt week on week, SteelOrbis has learned.

40 deals for a total of 598,900 mt of iron ore have been done at the Corex platform on September 5. In particular, one deal for 90,000 mt 60.6 percent Mac fines was signed at $84.1/mt CFR for shipment during the month of October.

During the given week, there have been sufficient iron ore supplies at ports, over 150 million mt, exerting a negative impact on prices. Finished steel prices have moved down again, weakening market sentiments. Currently, more blast furnaces have been in maintenance, reducing molten iron outputs, slackening the demand for iron ore. However, following the recent continuous decreases in iron ore prices and finished steel prices, market players think there may be some support at low price level in the near future. It is expected that iron ore prices in the Chinese market will fluctuate within a limited range in the coming week, though some slight losses are still possible.

Iron ore futures prices at Dalian Commodity Exchange have decreased by 2.58 percent today to RMB 678.5/mt ($95.6/mt) compared to the previous trading day, September 4, while decreasing by RMB 81.5/mt ($11.5/mt) compared to August 29.

As of September 5, rebar futures at Shanghai Futures Exchange are standing at RMB 3,083/mt ($434/mt), decreasing by RMB 176/mt ($25/mt) or 5.4 percent since August 29, while down 1.41 percent compared to the previous trading day, September 4.

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 7.0989