Market movements in the marine iron ore pellet sector have caused the price of concentrate to fall further in the low trading on Friday. Following the weak demand and the downward trend in the futures market, the prices of iron ore and concentrate pellets have significantly decreased in the week ending Friday, August 20th. In the following, we will evaluate the latest market monitoring in this section. Please be with Artan Press.
*** Iron Ore Indicators Quotes From Fast Market
Fine iron pellets with a purity of more than 65% fine were priced at CFR $ 34.5 per ton. This product experienced a price drop of $ 6.7 per ton yesterday. The 65% iron ore from Qingdao Port was priced at $ 20 by the CFR trading format. 66% of this port iron ore concentrate in CFR format was priced at $ 169. The product has dropped $ 16 in the last 24 hours. It seems that the price of iron pellets in the market will continue to fall.
*** Limited commercial activity in the iron ore pellet market
Limited trading activity in the physical iron ore market last week exacerbated the downward trend in demand. As a result, iron ore futures fell. This, in turn, evoked the price of iron ore, especially for first-class iron ore. It is not far from the eyes of market participants and analysts. Reliable sources told the fast market that iron ore pellets and iron ore concentrate will enter the fine price movement. These products are likely to experience a drop in price together. The fast market index for 65% Brazilian fine iron ore from the port of Qingdao in CFR averaged $ 174 per ton yesterday, down $ 18 per ton. Last week, the product was priced at $ 192 per ton.
*** Decline in pellet demand in Indian transactions
Demand for iron ore pellets in India rose last week, a trading source in Hong Kong said. This situation, which could be a reason for fewer offers to China, is a serious issue in future analysis. The domestic price of iron ore pellets in India has increased by $ 218-220 per ton cfr China. This increased the motivation of suppliers to sell to the Indian market. Because prices in China should be less than $ 210 per tonne cfr has increased.
*** China’s control policy and pressure on the Asian pellet market
Demand for pellets and concentrates in China fell last week, a source in North China told a fast market. Despite this, prices in China remained under pressure from steel production. It seems that China has been able to play its role in controlling prices well so far. Certain brands of iron ore concentrate used for processing in other industries are being sold at sharper discounts than in previous weeks. For this reason, the concentrate used for pelletizing has a lower premium or is sold at a discount.
*** QUID 19 slows down unloading operations in Chinese ports
An analyst in Shanghai said the lack of demand for iron ore pellets could be due to additional transportation costs. Such shipments from abroad and the time of delay in their unloading in Chinese ports are due to precautionary measures against Quaid 19. According to market participants, demand for high-grade iron ore weakened again with declining purchases, especially from steel mills in China, due to the projected production cut in 2021. Some mills have implemented programs to ensure a reduction in total steel production this year. This means that they will have to reduce production in the coming months, which will reduce the demand for iron ore pellets and concentrates.
*** Take a look at offshore iron ore pellet deals
A trader in Hong Kong said the iron ore pellet trade was limited in the Chinese maritime or port markets, but liquidity was very low in Chinese ports. Due to weakening demand, the physical market for iron ore concentrate came under considerable pressure. As a result, prices fell sharply and discounts returned for some products. An outlook for demand for iron ore and concentrate pellets is likely to be weak, said a trader in northern China. Because steel mills do not need high quality iron ore due to reduced steel production despite relatively good margins.
*** Growth of iron ore pellet imports to Chinese ports
Pellets imported to Chinese ports grew 1.18 percent weekly to 3.89 million tons. Concentrate imports fell 0.69 percent to 9.34 million tons a week. The price of pellets and iron ore concentrates in international markets fell sharply in the week ending Friday, August 6, and demand for high-grade iron ore also weakened.
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