The futures prices of iron ore continued to decline after opening, then stabilised and gradually rose. Finally, the futures prices closed at 828 /mt, up 1.35%.
In the spot market, the transactions of imported ore were active, and the prices diverged compared with last Friday. The prices of PB fines at mainstream ports in Shandong were 815-823 /wmt, South Africa lump prices 835 /wmt, BRBF 835 /wmt. The prices of PB fines at Lianyungang port were 825 /wmt. The prices of PB fines at mainstream ports in Hebei 823-830 /wmt, Jimblebar blend fines 785 /wmt, Newman lumps after dressing 945 /wmt, Newman fines 845 /wmt. The prices of PB fines at Tianjin port were 833-838 /wmt, IOCJ 923 /wmt, and MAC fines 820 /wmt.
This week, the global shipments and arrivals declined slightly. Although the supply tightened slightly, the pressure did not ease significantly.
According to SMM research, the total global iron ore shipments stood at 33.85 million mt last week (December 17-23), down 2% on the week. Among them, the shipment from Australia fell 9.7% on the week and that from Brazil increased 26% on the week. The total amount of iron ore arriving at ports stood at 23.72 million mt, a decrease of 2.4%, according to SMM statistics. At the same time, on the demand side, the resumption plans of some blast furnace were delayed this week, hence the pig iron output may decline and the consumption of iron ore may be affected. The current terminal demand of the steel industry chain was weak.
According to the China Iron and Steel Association, steel products inventory at key mills stood at 15.99 million mt in mid-December, up 648,600 mt or 4.23% compared with early-December and up 2.42 million mt or 17.83% on the year. The social inventory of the five major steel varieties fluctuated slightly to 7.36 million mt, an increase of 10,000 mt or 0.1% from the previous month.
However, it is worth noting that although steel mills slows down the pace of procurement, the restocking demand still exists due to the low raw material inventory. Moreover, as the Chinese New Year approaches, the expectation of winter storage is the main upside momentum for iron ore prices.
Considering that the intensified pandemic situation that may weaken the market sentiment, iron ore prices will still fluctuate widely.
