Japan quake failed may not have any major impact on iron ore prices, according to an assessment by The Steel Index (TSI), on the other hand, Indian iron ore exports fell by 10.14 mn tonnes in February on y-o-y basis on ban of exports by the state of Karnataka.
Despite the fact that five Japanese mills are located in Tsunami affected areas (Nippon Steel''s Muroran and Kimitsu, JFE''s Chiba and Keihin and SMI''s Kashima) the effect on the seaborne iron ore market has as yet been minimal. Unlike Kobe in 1995, iron ore unloading facilities in Tokyo Bay have not been seriously damaged and steel pro-duction remains steady
''Indian iron ore exports fell by 19% y-o-y in February to 10.14 million tonnes leaving the total shipped so far in the 2010/11 financial year at 85.43m t, down 18% against the year prior. The Federation of Indian Mineral Industries (FIMI) expects exports in March to be much lower than in February, when a four-fold hike in the iron ore export tariff (20% for iron ore fines) is expected to bite. The tariff takes effect from April 1st affecting cargo booked in March for shipping April,'' TSI monthly report said.
The Australian Bureau of Agricultural and Resource Economics and Sciences predicts iron ore exports to climb by 12% next financial year to US$63.1bn.In the near-term, Australian iron ore run rates recovered in March to near 100% having been disrupted in February by weather events. Tropical cyclones Carlos and Diana damaged railway infrastructure in the Pilbara as well as hampering mining activities and vessel loading. Run rates are expected to return to normal in April.
Brazilian iron ore exports to China were flat in February on subdued demand but are expected to improve in coming months.o China were flat in February on subdued demand but are expected to improve in coming months.Iron ore exporters are hopeful for an upswing in demand from Japan as the country begins to rebuild disaster-hit infrastructure.
The China Iron & Steel Association (CISA) renewed its commitment to implementing an „import agent system through which commissions for China''s 112 licensed iron ore importers would be capped when on-selling to domestic buyers.
Official figures released in March showed Chinese iron ore imports down by 29% in February as a result of the national holiday and high market prices. China''s crude steel output hit new highs in March (see right). However, senior traders and market sources have called into question the statistics. While steel makers have boosted production in hope of increased profits, it is suspected that reported crude production figures were artificially low in November and December last year when Beijing enforced energy conserving production cut-backs and that the lost production has resurfaced in the February and March data.
It is predicted that Chinese steel producers will maintain present levels of production through April to keep a lid on unit costs and to position themselves for an expected upswing in end user demand come the end of April / beginning of May.
Baosteel and Wuhan Iron & Steel have frozen ex-works prices for April. However, other stated-owned mill groups, including Hebei Iron & Steel and Anshan have bucked the trend and lowered ex-works prices for the coming month.