Iron ore futures closed the session higher with a late rally on Tuesday, after rebounding from the selloff from previous day.
The most-traded May iron ore contract on China’s Dalian Commodity Exchange (DCE), then rose by 2.01% day-on-day or up RMB 20.50 to RMB 1,039.50/mt on Tuesday.
The steel rebar contract on the Shanghai Futures Exchange, however dipped by 1.77% or down RMB 85 day-on-day to RMB 4,715/mt.
More output curbs outside Tangshan
Some trade participants expected other Chinese provinces might follow stricter emission policy being imposed in Tangshan, which resulted in record high steel prices.
For instance, the price of HRB400 20mm dia rebar hiked up to a three-year high at RMB 4,793/mt on Monday, while Tangshan billet steel prices also surged up to a 12 year high at RMB 4,620/mt by Mar 22, before moving down to RMB 4,560/mt on Tuesday.
With the extended output cut, Chinese buyers were heard to be more interested in higher Fe brands like Brazilian Blend Fines and Newman High Grade Fines, as they improved the blast furnace efficiency.
Lower iron ore shipments from Australia and Brazil
Australian and Brazilian iron ore shipments had reached 22.9 million mt during the Mar 15-21, down 476,000 tonnes or 2% week-on-week, according to Mysteel.
The decline in exports were related to unfavorable weather conditions as Australian iron ore shipments went down to 16.6 million mt, down 7% on-week, while Brazilian miners shipped 6.3 million mt, slightly better than previous week.
Going forward, the iron ore shipments from Brazil and Australia were slated to increase in Q2, as weather conditions improved.