Iron ore spot prices rise slightly in mid-March

Spot offers for imported Fe 62% ore in China rose to $104/t CFR Qingdao on March 18, up from $100/t on March 6, according to Kallanish. This brings the quotes back to the level seen at the beginning of the year.

On the Dalian Commodity Exchange (DCE), iron ore futures for May delivery fell to $100/t from $113/t in mid-February. On the Singapore Exchange, quotes fell by $6 to $106/t over the same period.

The weak growth reflects uncertainty among local steelmakers about future demand for steel products despite supply cuts. In January-February, steel production in China decreased by 1.5%, to 166.3 million tons. Iron ore production decreased by 12.6%, to 158.4 million tons. Ore imports decreased by 8.4%, to 191.36 million tons.

Indian iron ore producers refused to export in March, since domestic prices were quite high. This was reported by Bigmint with reference to market participants. At the same time, Chinese importers demanded a price reduction. According to the agency’s interlocutors, there are no prerequisites for this now.

One of the largest Indian players, NMDC, sold 44 thousand tons of Fe 62% lump ore at an auction on March 19 at $89/t (excluding tax liabilities). Another major producer, OMS, sold 991 thousand tons at $91.5/t on March 20.

Brazilian export prices for iron ore Fe 65% rose to $116/t CFR US by March 20. In mid-March, the supply was at $115/t.

The current situation on the Chinese market does not allow increasing export revenues of Ukrainian iron ore enterprises, since the cost of raw materials in China is a global indicator.

As reported, the China Iron and Steel Association (CISA) plans to create a compensation scheme for the closure of outdated and less efficient capacities amid government efforts to reduce steel production in the country.