Posted on 08 Jun 2021
Iron ore concentrates stocks among China’s 186 mining companies under Mysteel's survey had reduced further over May 21-June 3, down 189,400 tonnes or 13.4% to 1.2 million tonnes, or a new low since the commencement of the survey in January 2019, as the growth in demand had outpaced that in daily output among these mines, market sources noted.
Over the survey period, their daily concentrates output, nevertheless, climbed further by 9,400 tonnes/day on a fortnight to 54,600 t/d, and their concentrating capacity utilization rate rose by another 1.2 percentage point in two weeks to 69.93% on average, or both being relatively high.
“The demand for domestically-produced iron ore concentrates from both the domestic steel producers and pelletizing plants have been rather robust over the past two weeks,” a Shanghai-based analyst commented, and “its pricing competitiveness against imported cargoes has been rather attractive to the domestic steelworks,” he added.
China’ iron ore prices of both the imported and domestically-produced supplies experienced some volatility together with tumbles in domestic steel prices, but imported iron ore showed signs of recovery first starting May 27, and by June 3, Mysteel SEADEX 62% Australian Fines had regained $2.9/dmt from May 20 to $210.85/dmt.
In contrast, the offering price of 66% grade domestically-produced concentrates in Tangshan, North China’s Hebei, still fell Yuan 95/dmt ($14.8/dmt) from May 20 to Yuan 1,485/dmt EXW and including the 13% VAT by Thursday.
Despite so, “the prices of domestically-produced iron ore concentrates are still at historically high levels, and the Chinese miners, thus, have still been enthusiastic in maintaining high output and selling to the steel mills in exchange for rather outstanding margins, so it is of little surprise that the domestic miners’ concentrates stocks have been falling,” the analyst commented.
Source:Mysteel Global
