Seaborne iron ore prices slumped again on Friday, with the Kallanish KORE 62% Fe index breaking the $100/tonne barrier and hitting the lowest since May 2020. Prices are still trending lower with sentiment in Chinese steel markets very weak.
The Kallanish KORE 62% Fe index fell $2.99/t to $97.62/dry metric tonne cfr Qingdao. The Kallanish KORE 65% Fe index dropped $3.63/t to $115.90/dmt cfr, and the KORE 58% Fe index declined $2.30/t to $74.53/dmt cfr. 188,000 tonnes of FMG Super Special Fines sold at a floating price.
On the Dalian Commodity Exchange January 2022 iron ore settled down CNY 16.5/t at CNY 562.5/t ($87.89/t), while on the Singapore Exchange December 62% Fe futures settled down $2.46/t at $91.47/t. The same contract for 65% Fe and 58% Fe futures settled down $3.77/t at $109.08/t, and down $2.16/t at $68.64/t respectively. Tangshan billet remains stuck at CNY 4,770/t.
Seaborne iron ore prices fell below levels seen the previous two times that post-pandemic prices broke under $100/t, in July 2020 and September 2021. Prices now look set for a sustained fall under $100/t for the first time since early 2020. Chinese steel market sentiment has weakened to the extent that export traders are short selling material for early 2022 delivery, and domestic traders are expecting prices to fall further by the end of the year.
Chinese port stocks continue to tick higher, but at a slower pace than the previous week. Across 35 ports stocks hit 145.12 million tonnes, up 2.29mt over the week, according to SMM. Drawdown from port stocks, especially in northern China, remains very slow on restricted steel output.
