Reuters reported that the most traded iron ore for January 2015 delivery on the Dalian Commodity Exchange hit a session high of CNY 688 per tonne, its loftiest since July 18. It was up 1% at CNY 684 by midday.
The threat for iron ore prices remains the excess supply that has kept spot prices below USD 100 per tonne since May 19. A faster than expected increase in iron ore production by the world’s biggest miners in Australia and Brazil this year is pushing less efficient smaller suppliers from Europe to Australia to the Middle East to cut output or shut altogether.
According to Australian government data, by 2015, major producers in Brazil and Australia will account for 1.15 billion tonnes or 83% of world seaborne ore trade up from 71% three years earlier in 2012.
According to Iranian industry data, exports from Iran the world’s eighth biggest supplier on the seaborne market fell by a third in June from a year ago to just 1.2 million tonnes, a figure largely in line with numbers later released by China’s customs.
According to data compiled by Steel Index, iron ore for immediate delivery to China .IO62-CNI=SI stood at USD 94.30 per tonne on Friday. There was no pricing reference published on Monday due to the Singapore public holiday. Iron ore is down nearly 30% this year, having fallen to a 21 month low of USD 89 in mid June.
Source – Reuters