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Iron ore prices ticked down over course of last week - 30 April 2012

Downtrending steel prices filtered into the seaborne iron ore market early last week as squeezed margins discouraged Chinese mills from paying high prices for their key raw material.

Subdued ore buying interest saw the Platts SBB assessment of 62% Fe cfr north China material fall 75 cents Monday, while Tuesday bought a $1.50/dry tonne decrease to $148/dmt. The Steel Index followed a similar pattern, dipping $1.40/dmt on Tuesday, before both key indices stabilised Wednesday amid continued lacklustre buying activity.

Prices dropped again on Thursday as a low Brazilian deal was viewed by many as confirmation of a weaker market situation. One Chinese trader had five different Indians fines shipments on offer, none of which were taken up.

The Platts SBB assessment fell $1/dmt to $147/dmt, while TSI dropped $2/dmt to $143.8/dmt. With the Labour Day holiday around the corner, buyers were hesitant to commit to new cargoes despite the active October rebar contract edging up in Shanghai, and rebar and billet stabilising for a second consecutive day.

Chinese billet prices were steady Friday, despite the Shanghai contract dropping, and rebar was firmer. There was also an uptick in iron ore trading activity, with a Pilbara fines cargo trading higher. Pilbara fines were sought-after by mills due to their suitability for all blast furnaces and the deal was indicative of comparatively strong demand for the product compared to other types of ore, sources said.

The Platts SBB 62% assessment rose $1.25/dmt to $148.25/dmt: Despite the intraday movements throughout the week, Friday's assessment was only down 15 cents compared to Monday. On Friday TSI increased $1.60/dmt to $145.4/dmt.

China is on holiday for Labour Day between Sunday and Tuesday, which could keep spot ore activity quiet, sources suggest.

 

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