China Iron ore for January delivery on the Dalian Commodity Exchange lost 1% to end at CNY 675 per tonne after falling as low as CNY 669. It touched a two week high of CNY 692 yuan on Tuesday.
According to data compiled by Steel Index, iron ore for immediate delivery to China .IO62-CNI=SI gained 10 cents to USD 96 a tonne on Thursday, a level last seen on July 21.
Mr Cao Bo an analyst at Jinrui Futures in Shenzhen said that “I think the price will go down to 650 yuan in three months. Iron ore supply is abundant, both domestic ore and imported ore, especially imported ore. China imported 82.52 million tonnes of iron ore in July, up 10.7% from the previous month and the third highest on record.
Mr Lau from UOB Kay Hian said that “We had expected imports to slow down because port inventory remains high. But I think the price decline in June triggered some increase in bookings for seaborne cargoes and steel producers took that opportunity to stock up on some high quality iron ore.”
Iron ore fell to a 21 month low of USD 89 per tonne in June. While prices have since recovered, they have remained below USD 100 since that level was breached in May.
Adding pressure to spot prices, tugboat engineers at Australia’s biggest iron ore port have called off a strike that was due to hit exports from Aug. 9, as the union missed a deadline for filing notice of the industrial action.
Source – Reuters