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Fastmarkets iron ore indices 62% Fe fines, cfr Qingdao: $184.67 per tonne, up $0.25 per tonne 62% Fe low-alumina fines, cfr Qingdao: $185.47 per tonne, up $0.39 per tonne 58% Fe fines high-grade premium, cfr Qingdao: $149.00 per tonne, up $1.10 per tonne 65% Fe Brazil-origin fines, cfr Qingdao: $215.10 per tonne, down $0.30 per tonne 62% Fe fines, fot Qingdao: 1,287 yuan per wet metric tonne (implied 62% Fe China Port Price: $186.19 per dry tonne), down by 1 yuan per wmt
Key drivers The most-traded September iron ore futures contract on the Dalian Commodity Exchange (DCE) fluctuated in Monday night’s session, increased in Tuesday morning’s session but dropped in the afternoon session before closing up by 0.8% from Monday’s closing price of 1,054 yuan ($163) per tonne.
The most-traded September iron ore forward-month swap contract on the Singapore Exchange (SGX) also increased. By 6:58pm Singapore time, it had registered an increase of $0.95 per tonne compared with Monday’s settlement price of $178.05 per tonne.
Steel production cuts in the rest of 2021 remain a question.
“Today trading is active in China’s ports, and within one week trading in the seaborne market will be more active. If cutting steel production isn’t realized in the third quarter, the liquidity of iron ore in Chinese ports will help increase the liquidity in the seaborne market,” a trading source in Hunan province said.
“Some mills in Shanxi [province] were heard to be seeking both mid-grade and high-grade iron ore fines cargoes and have adjusted their blast furnace ratios to reduce the consumption of low-grade fines. The reason heard was high prices of coke, especially in the Shanxi area,” a Singapore-based buyer source said.
The source added that there was a controversy between carbon emissions reductions and economy growth. “The government wants to control raw materials price [but] cutting steel production will push steel prices higher,” the source explained.
Quote of the day “Despite the increment in futures markets, physical trading is still relatively limited – the Pilbara Blended fines’ premium is done at a lower level than [Monday] and the Super Special fines are traded flat at Chinese ports, meanwhile with the decrease in steel prices, mills are expected to buy less with weakening margins,” a trading source in Singapore said.
Trades/offers/bids heard in the market Vale, Globalore, 70,000 tonnes of 65% Fe Iron Ore Carajas fines, traded at the September average of Fastmarkets’ index for iron ore 65% Fe Brazil-origin fines, cfr Qingdao plus a premium of $4.60 per tonne, bill of lading dated July 28.
Rio Tinto, Globalore, 170,000 tonnes of 62% Fe Pilbara Blend fines, traded at the September average of a 62% Fe index plus a premium of $3.70 per tonne cfr, laycan August 30-September 8.
Globalore, 170,000 tonnes of 62% Fe Pilbara Blend fines, offered at $184 per tonne cfr China, laycan August 8-17.
BHP, Globalore, 100,000 tonnes of 62% Fe Mining Area C fines, offered at $173.95 per tonne cfr China, laycan September 1-10.
Market participants’ indications for: Fastmarkets index for iron ore 62% Fe fines Pilbara Blend fines: $181-184 per tonne cfr China Brazilian Blend fines: $182.50-187.00 per tonne cfr China Newman fines: $182.16-186.60 per tonne cfr China Mining Area C fines: $172.00-176.23 per tonne cfr China Jimblebar fines: $166.02-170.05 per tonne cfr China
Fastmarkets index for iron ore 65% Fe Brazil-origin fines Iron Ore Carajas fines: $213.80-219.20 per tonne cfr China
Port prices Pilbara Blend fines were traded at 1,250-1,280 yuan per wmt in Tangshan, Tianjin city and Shandong province on Tuesday, compared with 1,250-1,310 yuan per wmt on Monday.
The latest range is equivalent to about $181-185 per tonne in the seaborne market.
Dalian Commodity Exchange The most-traded September iron ore futures contract closed at 1,062.50 yuan ($164) per tonne on Tuesday, up by 8.50 yuan per tonne from Monday’s close.
Alex Theo and Zihao Yu in Singapore contributed to this article.
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