WEEKLY: China domestic iron ore prices continue falling
The downtrend in prices of iron ore derivatives early last week cast a shadow over the domestic iron ore market, prompting concs producers to cut their offering prices, a market analyst based in Shanghai noted.
On April 3, the most-traded iron ore contract for September delivery on the Dalian Commodity Exchange closed at Yuan 749/dmt ($105.7/t), lower by Yuan 19/dmt from that on April 1.
As of April 7, the offering price of 66% Fe grade iron ore concentrates in Handan and Xingtai in North China's Hebei province was assessed by Mysteel at Yuan 925/dmt excluding the 13% VAT, lower by Yuan 55/dmt on week. Sunday was officially a substitute working day in China after the Qingming Festival holiday over April 4-6.
Meanwhile, steelmakers' demand for domestic iron ore remained weak as most mills were still struggling with negative margins, the Shanghai analyst pointed out, noting that the mills only bought ore to meet their immediate production demand.
"Few steelmakers had replenishment demand for feed materials before the Qingming Festival holiday," he observed.
In East China, buying interest for domestic ore among local steelmakers was even weaker as some mills conducted maintenance on their blast furnaces last week, Mysteel Global learned.
As of April 7, the offering price of 65% Fe grade iron ore concentrates in Zibo city in East China's Shandong had dropped by Yuan 62/dmt on week to reach Yuan 953/dmt including the 13% VAT, according to Mysteel's assessment.
Concs suppliers and steelmakers are both holding a wait-and-see stance at present, and the prices of domestic concs are likely to continue sliding this week, according to the analyst.
Table 1: China's iron ore concentrate offering prices in major production bases April 7
Product |
Place of Origin |
Grade |
Price |
Change |
Notes |
Concentrate |
Tangshan, Hebei Province |
66% |
937 |
+15 |
3 |
Concentrate |
Handan/Xingtai, Hebei Province |
66% |
925 |
-55 |
2 |
Concentrate |
Daixian, Shanxi Province |
65% |
832 |
-30 |
1 |
Concentrate |
Beipiao, Liaoning Province |
66% |
700 |
- |
1 |
Concentrate |
Liaoyang, Liaoning Province |
65% |
770 |
- |
1 |
Concentrate |
Zibo, Shandong Province |
65% |
953 |
-62 |
3 |
Concentrate |
Fanchang, Anhui Province |
65% |
930 |
-10 |
3 |
Concentrate |
Daye, Hubei Province |
63% |
910 |
-30 |
3 |
Concentrate |
Heyuan, Guangdong Province |
64% |
742 |
-115 |
3 |
Concentrate |
Hainan |
63% |
682 |
-14 |
2 |
Notes: 1 - Wet basis, excluding tax; 2 - Dry basis, excluding tax; 3 - Dry basis, including tax. (Unit: Yuan/t) |
Table 2: China's steel mills' procurement prices in major areas April 7
Steel Company Name |
Region |
Grade |
Price |
Change |
Notes |
Hebei Jinxi Iron and Steel Co., Ltd. |
Hebei |
66% |
945 |
-65 |
1 |
Handan Iron Steel Co., Ltd. |
Hebei |
66% |
925 |
-55 |
1 |
Benxi Iron and Steel Co., Ltd. |
Liaoning |
65% |
938 |
+43 |
3 |
Fushun Xinfu Steel Co., Ltd. |
Liaoning |
65% |
938 |
+43 |
3 |
Xinxing Ductile Iron Pipes Co., Ltd. |
Anhui |
64% |
923 |
-30 |
2 |
Fujian Sangang (Group) Co., Ltd. |
Fujian |
64% |
860 |
- |
2 |
Guangdong Shaoguan Iron & Steel Co., Ltd. |
Guangdong |
64% |
1,050 |
- |
1 |
Notes: 1 - Dry basis, including tax, payment by acceptance, delivery; 2 - Dry basis, including tax, cash payment, delivery; 3 - Dry basis, including tax, payment by acceptance, delivery, base price; 4 – Dry basis, excl. tax, delivery, base price; 5 - Wet basis, excl. tax, no delivery (Unit: Yuan/t) *Sample objects here are altered to Shanxi Xingyuan from previous Jiugang Group as of the Dec. 8-12, 2014 session. |
Written by Anthea Shi, shihui@mysteel.com
Edited by Russ McCulloch, russ.mcculloch@mysteel.com
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