It is reported that impacted by falling Chinese domestic steel price, piling up steel inventory and the worry of government’s restriction on cash liquidity, Chinese steel market was in downward trend last week, and this sentiment was reflected in iron ore spot market as well which remained weak.
Several transactions were heard at much lower levels, but Indian sellers are resisting the slide in prices and were reluctant to reduce their prices anticipating revival in demand as the Chinese demand remains quite firm
On the other hand, Chinese buyers are also anticipating that Indian sellers would give in and prices would slide further.
Meanwhile, based on growing appetite of Chinese steel mills for iron ore, various banks have increased their forecast for hike in annual benchmark talks.
A median forecast in a Reuters survey of 13 analysts conducted in the last two weeks showed Australian iron ore prices are expected to rise by 30% in 2010/2011 annual contract talks