Posted on 11 Jan 2022
The Chinese market saw domestic steelmakers' demand for imported iron ore improve over January 4-7, with the prices reversing from an on-week decline. As of January 7, Mysteel SEADEX 62% Australian Fines had climbed to $127.75/dmt CFR Qingdao, nearly a three-month high, or up $8.1/dmt on week.
On the same day, Mysteel PORTDEX 62% Australian Fines in Qingdao rose by Yuan 33/wmt ($5.2/wmt) on week to Yuan 837/wmt FOT and including 13% VAT, also a high since October 27.
In the futures market, the most-traded iron ore contract on the Dalian Commodity Exchange for May 2022 delivery rallied too over the past week, closing the daytime trading at Yuan 719/dmt last Friday, up Yuan 45/dmt from the settlement price on December 31.
"With some steelmakers lifting their production gradually, their demand for iron ore had recovered markedly over the past week, while the spot trading also became active," a Shanghai-based market watcher said.
Over December 31-January 6, the blast furnace capacity utilization rate among China's 247 steel mills under Mysteel's survey had climbed for the third week by another 2.1 percentage points on week to 77.89%, after more blast furnaces in North and East China had resumed their operations, as reported.
Moreover, iron ore traders were also more willing to stock up and to defend their prices of stocks at hand, on the anticipation of firm demand after the Chinese New Year holiday over January 31-February 6, Mysteel Global noted.
Meanwhile there are still some emergency curbs on sintering operations among steelmakers in North and East China, their demand for lump had remained strong over the past week, which also bolstered the iron ore prices.
As of January 7, Mysteel's 62.5% Fe iron ore lump premium against 62% Fe Australian fines had climbed to $0.28/dmtu - a high since August 16, or up $0.0855/dmtu on week, according to Mysteel's assessment.
Source:Mysteel Global
