Bulk Buys: China’s steel sector lifts iron ore to 10-year high, coking coal stabilises
- Iron ore 62 per cent fines prices traded this week at $US182 per tonne, up $US7.45 on a week ago
- Hard coking coal prices were down $US2 on-week at $US105.10 per tonne at Queensland ports
- China’s steel reinforcing bar price is down $US9.55 this week at $US770 per tonne, close to a 12-year high
Iron ore prices have reached their highest level for 10 years as the seaborne market’s main customer, China, cranks up its steel output in line with its strong economic performance.
Cargoes of 62 per cent Fe grade iron ore for delivery to China are trading at $US182 per tonne ($233.55/tonne) this week, according to Metal Bulletin.
The spot price for seaborne cargoes of iron ore has risen 355 per cent from its 2016 low point of $US40 per tonne and is trading at its highest since September 2011.
“Iron ore prices rose to their highest level since September 2011 on steel demand hopes in China,” said analysts at Commonwealth Bank of Australia (CBA) in a report.
“Booming steel production continues to support the iron ore market. China’s steel output rose by 19.1 per cent in March to 94.02 million tonnes,” ANZ Bank analysts said.
“This has helped push China’s iron ore imports back above 100 million tonnes for the first time since October,” they added.
Emissions controls on steel mills in China’s Tangshan region continue to exert upward price pressure on iron ore prices, especially for higher grade iron ore.
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