Lump premiums decline on softer fundamentals

Lump premiums trended lower over the past week amid weakening fundamentals and a shift in market balance. The Mysteel PORTDEX 62.5% Lump Premium decreased by 6.70% to Yuan 1.2754/dmtu between September 18 and September 25, while the Mysteel SEADEX 62.5% Lump Premium fell by 0.15% to $ 0.16/dmtu.

The drop in lump premiums was primarily driven by a combination of muted demand and increased supply. Weaker steelmaking margins reduced lump consumption, with the average lump ratio among 114 sampled steel mills falling by 0.15 percentage points to 10.46%. On the supply side, lump supply rose notably, as combined arrivals of PBL and NML surged by 21.74%