According to data from Mysteel spot ore imports price has shown sign of weakening after sharp rally in earlier days. Benchmarking 63.5% Indian ore fine is quoted at USD 129 per tonne to USD 132 per tonne CIF on January 26th down from last week USD 135 per tonne to USD 137 per tonne. Meanwhile, the ore imports stockpile at Chinese seaports also hit a three month high of 67.42 million tonnes on last Friday.
Mr Zeng Jiesheng senior analyst with Mysteel said the downward correction has been expected by market analysts. Major steel products price has witnessed big downslide last week with construction steel suffering price loss of over CNY 100 per tonne in some regions. The market inventory of steel products remains high at the moment, which may indicate down stream demand is not that strong as expected. He said that "Iron ore price won't go up for ever given the limited profit margin of steel mills."
Traders also note that foreign ore miners have already lowered their offer prices and the actual trade price is even lower. Some smaller traders are offering materials at USD 125 per tonne to USD 126 per tonne in a bid to drive down stock before Lunar New Year Holiday. However, most steelmakers are in no rush to replenish ore stock right now and they are very cautious in purchasing materials. That explains the quiet trade and climbing ore stockpiles at seaports.
Nevertheless, it's widely held that China iron ore import will stay above 50 million tonnes in January the average import tonnage recorded in last 12 months. And steel mills around the world have reported higher production rate in January which would help shore up the iron ore demand in days to come.