Seaborne iron ore prices continued to fall, as steel mills slowed their purchases before the Labour Day holiday.
The Kallanish KORE 62% Fe index fell $1.04/tonne to $186/dry metric tonne cfr Qingdao. The Kallanish KORE 65% Fe index slipped $0.71/t to $220.22/dmt cfr, but the KORE 58% Fe index inched $1.86/t higher to $170.16/dmt cfr. A cargo of 80,000 tonnes of JMBF fines for June shipment sold at floating prices.
On the Dalian Commodity Exchange September iron ore settled down CNY 5.5/t at CNY 1,130.5/t ($174.66/t), while on the Singapore Exchange May 62% Fe futures settled higher by $0.25/t at $187.70/t. The same contract for 65% Fe and 58% Fe futures settled at $223.32/t and $178.15/t, up $0.66/t and $8.08/t respectively.
Following China’s adjustment to import and export tariffs, the market expects a decline in crude steel production that will affect iron ore demand. However, in the short term, steel mills’ profits are supported by high steel prices, and steel mills are more enthusiastic about production, which also supports iron ore.
The short supply has caused China’s scrap prices to continue to rise. Variety 6mm+ heavy scrap delivered to mills in the Yangtze River Delta region inched CNY 13/t higher on Wednesday to CNY 3,556/t. In Tangshan, billet prices increased by CNY 10/t at CNY 4,990/t.
By Kallanish Team
