PB fines port-stocks price buoyed by lower inventories
Source: Mysteel
Sep 27, 2018 16:30
“We have sold all of our PB fines port inventories at ports in Shandong province and plan to buy some more – either seaborne cargoes or port stocks – when prices are reasonable,” a Shanghai-based iron ore trader said, adding that “steel mills are replenishing their internal stocks for the imminent seven-day National Day holiday, and PB fines – a mainstream product used widely among Chinese steel mills – are definitely hot now.”
An official with a Hebei-based steel mill also confirmed that his mill has felt some tightness in PB fines port inventories recently, at those in Hebei province and Tianjin city. “PB fines inventories at Caofeidian and Jingtang ports are low now,” he added.
Consequently, the price of PB fines has been steadily strengthening over the past few weeks and seen the price of this product at Caofeidian port gain Yuan 22/wmt ($3.2/wmt) on month to Yuan 530/wmt and that at Qingdao port rise by Yuan 29/wmt on month to Yuan 510/wmt as of September 26, both in terms of FOT Qingdao including the 16% VAT.
In fact, PB fines port inventories at the 45 Chinese ports nationwide which Mysteel surveys have been on a downward trend since early July, and in the past several weeks, the rate of de-stocking at Rizhao, Tangshan and Jingtang ports has been fast, according to a Mysteel analyst who conducts Mysteel’s surveys on iron ore port inventories. “The continuing decline is partly due to the reduced supply from iron ore miners in the past several months and more demand from Chinese steelmakers when the quality of the ore improved some in July.”
Mysteel’s latest market survey showed that stocks of Australian iron ore (including PB fines) at the 45 Chinese ports decreased for a tenth straight week over September 14-20, losing 68,100 tonnes week on week to reach 89.5 million tonnes as of September 21.
Chinese industry insiders have acknowledged that improvements Rio Tinto has made to its PB fines iron ore product over the past several months resulting in higher Fe content and fewer impurities, have won customers back to PB fines and regained its popularity among Chinese steel mills, Mysteel notes.
Written by Victoria Zou, zyongjia@mysteel.com
Edited by Russ McCulloch, russ.mcculloch@mysteel.com
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