Benchmark iron ore futures in China
extended gains for a third straight session, closing at the highest price in
five weeks, fuelled by falling supplies from major miners.
Shipments from Australia and Brazil — China’s two
major iron ore suppliers — fell by 4.04 million tonnes to 24.04 million tonnes
as of April 9 from the week earlier, data from Mysteel consultancy showed.
Operational problems and heavy rains are
affecting iron ore shipments in
Brazil.
IRON ORE PRICE RALLY HAS
BEEN SUPPORTED BY INCREASING STEEL DEMAND
Iron ore exports to China from Port Hedland, the top
iron ore terminal in Western Australia, recovered by 7.4 million tonnes or
19.4% from February’s low to total around 38.1 million tonnes in March, according to Mysteel.
Last month’s tonnage, however, was still 2.3 million
tonnes, or 5.7% down on the year.
The most actively traded iron ore futures
on the Dalian Commodity Exchange for September delivery ended up 3.3% at 1,023
yuan ($156.17) per tonne after gaining 3.5% earlier in the session.
“Domestic demand and consumption driven by overseas
economic recovery also helped sustain iron ore prices,” analysts with
Huatai Futures wrote in a note.
China imported a total of 283.4 million tonnes of
iron ore over January-March, higher by 21 million tonnes or by 8% compared with
Q1 2020, according to the latest statistics released by the country’s General
Administration of Customs.
Benchmark 62% Fe fines imported into Northern China
(CFR Qingdao) were changing hands for $173.25 a tonne, down 0.75% from the
previous trade, according to Fastmarkets MB.
Steel
demand spike
The iron ore rally has been supported by increasing steel demand.
The beginning of 2021 saw a sharp increase in demand,
while metallurgical plants were still recovering from the operational downtime
incurred during the lockdown.
According to IndexBox, global
consumption is forecast to increase in 2021
by 4.1% year-on-year.
“The EU (+11.0%) and other European countries
(+11.9%) are projected to see the fastest rates of consumption growth, spurred
by a full recovery in the automotive and construction sectors, and other
downstream industries,” the market research company said.
Mining.com