Impacted by volatile market sentiment, prices of imported iron ore in China retreated late last week after climbing when business resumed following the New Year holiday weekend, Mysteel Global observed. Despite that, the prices still hovered at high levels.

Mysteel SEADEX 62% Australian Fines ended last week at $140.1/dmt CFR Qingdao on January 5, down by a small $0.45/dmt on week, while the index for Mysteel PORTDEX 62% Australian Fines in Qingdao was at Yuan 1,059/wmt FOT and including the 13% VAT on the same day, for an on-week rise of Yuan 19/wmt.

Early last week, iron ore prices in China's spot and futures markets performed strongly, as sentiment had brightened after the People's Bank of China offered Yuan 350 billion worth of loan injections – via the country's pledged supplementary lending facility – to support housing and infrastructure projects nationwide, Mysteel Global noted.

However, in the days that followed the confidence of market players in steelmakers' near-term demand for iron ore waned gradually, after they saw more mills idle blast furnaces (BFs) and conduct maintenance so as to minimize their losses on finished steel sales, a Shanghai-based market watcher noted.

For example, Mysteel's weekly tracking of the 137 Chinese steelmakers it samples showed that over December 28 2023-January 3, their rebar output dropped to reach an 11-month low of 2.44 million tonnes, down by another 3% on week, the latest survey posted last Thursday showed.

For this week, China's imported iron ore prices may fluctuate further, the source suggested. "A small uptick may be seen in steelmakers' hot metal production, after makers complete the annual maintenance on their BFs," he elaborated.

On the other hand, China's portside iron ore stocks will continue to accumulate, exerting some downward pressure on iron ore prices, he added.

Refer to: https://www.mysteel.net/