Iron ore concentrate prices rise over $3 per tonne

Seaborne iron ore concentrate prices rose on active buying while domestic supply thins.

Metal Bulletin’s weekly 66% Fe Iron Ore Index cfr China stood at $98.74 per tonne last Friday, up $3.43 per tonne.

The daily 65% Fe Iron Ore Index averaged $95.48 per tonne cfr China last week, compared with an average of $94.04 per tonne cfr China the previous week.

With limited supply in the Chinese market, some steel mills are likely to be restocking for winter – when domestic concentrate stocks will be short – adding to the increase in prices, according to some traders.

“Concentrate prices have been rising due to strong pellet prices because winter is coming when sintering will be cut and domestic concentrate output will shrink,” one trader said.

Around seven to eight 65,000-tonne cargoes of 65% Fe Australia Karara concentrate were heard traded at a premium of $3.15 per tonne against an October average of a 65% Fe index, October delivery.

Previously, the Australian Karara concentrate cargoes were traded at a premium of $0.40 per tonne against the September average of a 65% Fe index.

A 200,000-tonne cargo of 66% Fe Chilean concentrate with 0.07% sulfur was heard to have been traded at an arrival month average of a 65% Fe index, with Fe adjusted plus a premium of $2.80 per tonne, arriving in China soon.

In addition, a 66% high-sulfur Iranian concentrate cargo with 0.9% sulfur content was heard to have been traded at a discount of $10 per tonne, adjusted to a 65% Fe index, set to arrive in China over September.

A South African 64.5% Fe PMC concentrate cargo was also heard to have changed hands at a premium of $4.20 per tonne, adjusted to a 62% Fe index, according to traders.

The weekly Metal Bulletin 65% Fe Pellet Index stood at $159.61 per tonne cfr China on Friday September 7, up $1.16 per tonne from a week earlier setting a new record high.

Pellet prices still have the potential to rise, market participants said.

A 65% Fe KIOCL cargo was heard to have been traded at around $160 per tonne, unchanged from the previous week’s trade, suggesting that pellet prices could have also peaked, according to traders.

The market had also assessed both a 65% Fe Essar pellet and 64% Fe JSPL cargo at around $147.50 per tonne cfr, while offers for a 64% Fe BRPL cargo was heard to be at around $156 per tonne.