Seaborne iron ore prices strengthened July 5 on the back of increasing steel prices.
Global Platts assessed the 62% Fe Iron Ore Index at $221.40/dry mt CFR North China on July 5, up $4.1/dmt from July 2.
Demand for medium-grade Pilbara Blend Fines remained healthy,but more end-users were heard expressing interest in other medium-grade fines as losses began to appear. The greater affordability of MAC
fines appealed to several mills despite weaker sintering properties compared to PBF.
“We are considering using more MAC,” a Chinese steel mill source said. “The increased supply of MAC is preferred as supply consistency is important.”
High-grade fines remained in demand. Market sources saw a lack of high-grade fines available to blend with low-grade fines.
Discounts for Jimblebar fines, or JMBF, continued to widen as abundant quantities at portside has hindered demand for seaborne JMBF.
“The import loss is more than Yuan 100/wmt; it is difficult for seaborne cargoes to trade at current prices,” a Chinese trader said.However, the trader said liquidity for JMBF at portside had improved.
The spread between PBF and JMBF was heard to have narrowed slightly to Yuan 170/wmt, down from Yuan 180-200/wmt last week.
Seaborne lump premiums continued to fall as end-users reduced usage of mainstream lump.
“We use less lump as margins have not been good. Furthermore, more non-mainstream lump can be use if needed, as it helps to reduce cost faster,” a Chinese steel mill source said.
Market sources also expect the supply of mainstream lump to improve as production increases from BHP’s South Flank mine.
Platts assessed the spot lump premium at 72.5 cents/dmtu on July 5, down 0.5 cents/dmtu from July 2.
Disclaimer: this article is from the SBB STEEL MARKET DAILY, the copyright belongs to the original author, and only represents the original author's viewpoint.
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